City’s draft budget squeaks by

June 4, 2005

The Hood River city budget has been tentatively balanced without any new taxes or fees — at least for now.

On Tuesday, the city council, serving as the budget committee, reviewed an amended tabulation of figures.

In early May, the committee had requested that Finance Director Steve Everroad and City Manager Bob Francis perform further scrutiny to see if any cost-saving measures were still available.

Officials had hoped to avoid passage of the original draft budget that included multiple fee and tax increases.

However, the recent adjustment of the bottom line from $23,455,976 to $22,616,028 could make it difficult for the city to reduce its existing $500,0000 deficit.

But the new budget is expected to stop any employee layoffs or reduction of essential services.

“It’s not a real comfortable budget, it doesn’t have a lot of leeway in it. But I guess at least it’s a guideline for the upcoming year and it has been balanced without forcing the committee to adopt new fees,” said Everroad.

In order to save money, the city expects to lower the adjusted cost of living raises for workers from 5 percent to 2.5 percent. That deal will have to be agreed upon by the involved labor unions.

The biggest spike in city expenses for fiscal year 2005-06 has been personnel costs associated with 60 staffers. The city’s share of the Public Employees Retirement System alone will be more than half a million dollars, with another $145,000 expected next year. In addition, health care costs have risen to 18 percent for the upcoming year.

Francis and Everroad were also able to save $125,000 in the new budget by restructuring the hierarchy at the fire department to eliminate overtime and lower operational expenses. They also took out some of the proposed capital improvement projects for the upcoming year to provide even more savings.

In October, the budget committee, which also includes several citizens, plans to take a look at how the new budget is working. At that time they will determine if progress has been made in reducing the deficit and whether any programs are being shortchanged. If the committee deems it necessary, Everroad said the proposal for new taxes and fees could be back on the table.

The list of optional new charges includes a three cents per gallon gasoline tax, about $20 annually for the average motorist, and a two percent food and beverage tax at full-service restaurants. Francis previously expected revenue from these combined taxes to bring the city an additional $400,0000 per year.

Other possible user fee increases could be implemented to cover the cost of infrastructure improvements. These include a street maintenance fee of about $1 each month for each household, and a business tax of about $100 annually. Water and sewer rate hikes could also be implemented, along with a new fee for stormwater maintenance.

The council could also revisit Francis’ recommendation to raise downtown parking fees at the four city lots. The 249 people who currently pay between $15-$25 monthly at one of these lots would then be asked to pay a flat fee of $30.

The city council will present the proposed budget to the public for comment on June 13 at 6 p.m. in the municipal courtroom.

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