City Council vote on 18% utility tax increase deadlocked

DAYTON–The City Council did not pass an 18% utility tax increase ending in a tie at the meeting May 12.

A thorough presentation was made by Mayor Zac Weatherford addressing the current expense shortfalls anticipated this fall due to the increased cost of law enforcement, dispatch and municipal court services to Columbia County totaling $612,500, as well as increase in pull from the retirement benefit.

Weatherford said beyond just avoiding a deficit, a 60-day current expense reserve of $150,000 is needed which the City had prior to the flood last year. "My big plan as Mayor has always been to enhance and promote Dayton. Instead of being reactive, I like to be proactive. I want to come up with a long-term plan that will help Dayton in the long run not 'die on the vine.' I don't want to put a band-aid on this problem."

Councilman Michael Paris offered support and motioned to approve one of four plans presented saying it was "lucrative." This plan called for an 18% increase of utility taxes to residents. Only six of the seven council members were present and the vote ended up tied 3-3.

The 18% plan would allow for zero cuts to employees and services and allow the City to expand eligibility for the utility rate reduction program. At the same time, the City would reduce by a minimum of 5% all Current Expense-funded departments except for those contracted with the County and the City attorney. Also, this plan states the City would "reallocate 30% of water and sewer investment interest revenues to support various-mandated services."

This tax increase would mean an additional $21 per utility bill.

The other three options presented were 12% or 15% utility tax increases with an elimination of three part-time public works employees in either case, or the elimination of council and mayor salaries plus a 10% salary reduction to exempt employees, 20% reduction each to parks and cemetery, the elimination of one full-time public works employee plus three part-time public works employees.

The only option providing a long-term increased ending fund balance is the 18% plan. The 15% plan provides a decreasing balance over time and the other options still show a negative balance after just two years. (see graph)

Weatherford concluded the only plan that is sustainable is the 18% plan and compared it to the others presented saying it shows it can work as a long-term plan with increased ending balances and not cutting services but increasing services. He also remarked the 18% alone does not cover what is owed to the County.

Councilman Dain Nysoe who is on the Finance Committee thought none of the plans were sufficient. "I don't see anything in your proposal that reflects what the Finance Committee recommended to begin with," Nysoe said. "...It's like you ignored some of the issues raised by the Finance Committee...There's not enough input on the City's part in resolving this issue."

Nysoe mentioned staff salary cuts and public works salaries and services. Weatherford answered that he is not recommending the salary and service reductions because of the long-term consequences of deferring maintenance.

Councilwoman Delphine Bailey questioned the Mayor saying that the 30% reallocation of water and sewer investment interest was never discussed in the Finance Committee meetings. Weatherford answered to say that part of the plan was worked out between himself and his staff and clarified that 30% would be roughly equal to $10,000.

"I don't want to put all the weight of this burden on to our constituents, on to the citizens, on to the people who are paying the utility bills," Weatherford said. "The City has to take some responsibility. The City has to do their part to trim out where they can."

Bailey also expressed doubt that with increasing the tax, once ending balances are up, that the taxes would never be reduced again.

Weatherford told the Council any plan adopted could be revisited at any time. He said that he would call a special meeting to further discuss options to be voted on again. The presentation will be available on the City of Dayton website.