City juggling funds to balance budget

Whitefish Pilot

City residents may see rate increases for water, sewer, solid waste and ambulance in the next year, along with higher property taxes.

Those are the hard facts Whitefish city councilors faced June 22 when they took a first look at the city's budget for the upcoming fiscal year.

The preliminary budget presented by city manager Chuck Stearns calls for holding property taxes at 112.21 mills, but recent state reappraisals could raise the value of a mill by 5.1 percent. So while property owners may see the same mills as last year, they could end up paying more in taxes.

There is also the question of what to do with a 24-mill levy voters approved last August to pay for 24/7 firefighter-paramedic services.

Voters were told the $464,759 raised by the levy would pay for six additional emergency personnel, but the city actually hired seven firefighters to implement 24/7 emergency service.

Then, on Dec. 26, the city learned it will receive $650,280 in federal grant money to help pay for the transition to 24/7 service over five years. The amount from the SAFER grant will decrease by 20 percent each year, but the grant will provide $234,090 in the first year.

Revenue from the mill levy should not be used to "pad" the budget, councilor Nancy Woodruff said. It should be reduced to 12 mills or whatever is needed after the SAFER funds are spent, she said.

"I have strong feelings about this," she said.

Mayor Mike Jenson and councilor Ryan Friel agreed, but Stearns said he wasn't aware of how the mill levy was presented to the voters. Stearns said he was also concerned about whether 24/7 service could be sustained without additional funding.

"We didn't say we wouldn't raise taxes if we got the grant," Jenson pointed out.

The overall FY2010 budget is $44.5 million — an increase of 53 percent over last year's budget. The increase is due to appropriations for 24/7 emergency service, Central Avenue reconstruction and the new Emergency Services Center, and revenue from issuing tax-increment financing (TIF) bonds and a $3 million donation for the A Trail Runs Through It project.

Stearns calls for a number of measures to help shore up the planning department, which struggles with declining permit application fees:

¥ The planning department will charge other city departments building fees for new construction. (Curiously, the impact fee charged to the new Emergency Services Center will help pay for the center itself.)

¥ Moving the planning department into the former Park Side building at Depot Park could save the city $60,000 a year in rent.

¥ About $207,000 will be transferred from the general budget to the planning department to avoid laying off additional personnel.

"It's good to hang onto experienced staff," Woodruff said, "but the public wants to know how reduced permit fees can pay for the staff."

Councilor Turner Askew asked if the city could afford to continue administering the critical areas ordinance (CAO) — including in the two-mile planning area, the so-called "doughnut."

"It's choking us," Askew said about the CAO.

Stearns said it's been his past experience that planning departments are always just keeping up with permit applications with no time for long-range planning.

"But if we lose the 'doughnut' area to the county, we can get rid of a planner," he said.

Notable preliminary budget items include:

¥ No money has been budgeted for a proposed hydro plant at the city reservoir. The hope is that the city's energy consultant will find grants or other funding to get the facility operating again.

¥ Stearns called the parks department "under budgeted," but taking weed spraying in-house will save money and do a better job.

¥ The council reluctantly agreed to budget $10,000 to hire a third-party litigator to force LaMar Advertising, of Billings, to remove its billboard sign on the U.S. 93 strip.

¥ Public works director John Wilson noted that street maintenance is being cut back when the cost of chip-sealing is dropping.

"With all the new roads and subdivisions, we don't want to fall behind," he said.

¥ Stearns conservatively estimated that resort tax revenue will decline by 20 percent, due to the economy.

¥ A million dollar loan for the sewer treatment plant and an audit showing the sewer fund has been losing money will drive the need to increase rates.

¥ The city will use $1.3 million in TIF funding to complete the Depot Park purchase, due by Oct. 23.