PRWID Conducts First Hearing on Tax Increase
A proposed tax hike for next year was discussed at first public hearing at the Price River Water Improvement District board meeting on Tuesday.
The PRWID staff had prepared the room for a crowd of people to talk about the issue.But the vast majority of the seats were filled by PRWID employees and people who were at the meeting for different reasons.
The session was a preliminary tax increase meeting which the state requires the district to have and at which the board takes no action on the issue.
The final public hearing on the proposed increase will come next August and at that meeting the board will have to make a decision on the issue.
PRWID board member Keith Cox assured residents at the meeting on Tuesday that no decisions by the board have been made on the proposal, which would increase the property tax on a home assessed at $150,000 about $16.59 per year.
"In our eyes, there is a need for an increase to cover ever escalating costs incurred by the district," said Cox.
He cited three issues that are driving the move for an increase which would raise the districts mill levy from .0006 to .0008. The first reason he cited was concerned increased fuel costs.
"While our reasoning on this includes fuel for our district vehicles, it also includes the extra money it is costing us to have supplies and materials shipped to us," said Cox. "We also have to use energy at the plants to treat water and to process sewage, and those costs have increased as well."
Cox also noted the fact that the district has acquired a number of small water companies over the years, increasing the need for more maintenance help
Finally, the board member explained that the costs of having employees is increasing as well, particularly in the areas of benefits, such as health insurance.
Cox then asked the staff to comment on other factors that play into a needed increase.
"One of the things that has been concerning us is our bond payments that come due each April," pointed out Phil Palmer, the district's manager, concerning the near $1 million dollar obligation that comes due every year.
"To balance our budget in the last few years, we have been pulling money out of our reserves. We have depleted those to the point that we are coming close to not meeting our covenants on those loans," added Palmer. "We certainly do not want to default on any of the provisions concerning our bonds."
Jeff Richens, assistant district manager, talked about the increase in terms of how it would affect people's tax bills.
"The increase in the cost to home and business owners is not as much as it first appears by the way we advertised it in the paper," explained Richens. "State law requires us to advertise it a certain way and the ad stated it would be a 23 percent increase. But that could be taken wrong, because it is only a 23 percent increase on PRWID's portion of the taxes, not the entire tax bill. I also want to point out that this would be the first tax increase the district has requested since it was formed in 1961."
The staff also presented to the board and those at the meeting a written cost comparison of various kinds of materials and supplies the district uses based on figures in 2000 and those from this past year. The comparison shows that in 2000 a ton tank of chlorine for the water plant cost $490. But in 2004, it has gone up to $600, which is a 22.5 percent increase in cost. They also noted that electricity has gone up 7.5 percent, natural gas has increased 51 percent and gasoline for district vehicles has increase in cost 38 percent since that same year.
When Cox opened the meeting for public comment only two residents of the county spoke.
Lynna Topolovec, a resident of Spring Glen, asked about the difference between the money raised by taxes and those raised by water and sewer rates, and how for what those funds are used.
"We have various funding sources for various parts of the budget," said Richens. "If you look through the budget for next year you can see each department has different revenue sources. On some things, however, we have no choice. For instance, general obligation bonds must be entirely paid from tax revenues, as required by state law."
Palmer, pointed out however, that most of the funds that come from both sources are plugged into the budget at the discretion of the board.
Another resident voiced his support of the increase saying that based on his experience with what is going on with the economy, the district will need the money.
"We think this increase is important because everything is going up in cost and the district cannot continue to operate without more funding. If they don't get it there will be a train wreck down the road," said Dennis Cole.
There was no voiced opposition to the increase during the public hearing.
In another agenda item, Palmer said that "The Hill" subdivision pump house project is moving along again.
"Our cement contractor showed up on Dec. 15 like he said he would and will be pouring the walls to the pump house this Thursday," he said. "Then they will remove the forms and pour the roof next week. Of course, in this weather the concrete will need to be heated for it to set up properly."
Richens said that the electrical contractor had been roughing the electrical boxes as the cement is being put in as well. He also presented a bill to the board for $3,011.15 from Ballard Electric for materials they have bought for the project. The board approved payment.
The board also approved a meeting calender for next year. The PRWID board will meet the first and third Tuesday of each month except in December when the second meeting of the month will take place on Dec. 27 to allow for easier computation of yearly costs at the end of the budget cycle.