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Home arrow News arrow Local News arrow PANEL REJECTS WATER FEE, PARES BUDGET



By Ray Linker

Observer Staff Writer

With some belt-tightening, the City of La Grande's budget committee has approved a $34.7 million budget for 2002-03.

City workers won't be laid off, the swimming pool won't be closed, no major programs will be cut, but the budget will continue to tighten in future years under Oregon's property tax limitation laws unless major new sources of revenue

are found.

These were among the comments that City Manager Wes Hare made after the 14-member committee, which includes the seven city councilors, wrapped up three days of meetings and sent the budget on to the council for final approval.

"Things went well in many respects," Hare said. "There were some very good discussions about how the city should approach its financing.

"The committee didn't want to see a franchise fee of 5 percent added to water and sewer charges, and with that decision, the committee faced the decision of where to make cuts. The city staff and the committee dived into the issue, and each had their own ideas of where to cut. We came up with a sort of compromise package," Hare said.

The final budget was approved by a 12-2 vote. The committee earlier had voted 9-7 not to increase the water and sewer fees.

That fee, which would have added $160,000 to the city coffers, was called a rate increase, another tax and worse.

To help make up for the decision not to collect the fee, the committee decided not to distribute $75,000 of its transient room tax collections for economic development. The Emerging Opportunities Fund was trimmed from the budget, but the tourism aspect of the tax distribution — which gets 60 percent of the room taxes — was not affected.

Close scrutiny by the committee indicated that the proposed budget had $37,000 too much allotted for workers' compensation and that was adjusted to reflect a more realistic estimate of that item.

Trimming that fund was "a little bit of a risk," Hare said.

Some $32,000 in capital outlay was also axed, including $20,000 the city had planned to spend for a new phone system. Instead, the city can get the system through a lease/option plan without spending money up front and the system eventually would be paid off.

Smaller cuts, of $3,000 each, were made in the city forestry and city travel budgets.

Hare said he viewed some of the cuts, such as one for buying playground equipment, a delay or deferred action rather than a cut.

The manager said funds created by the formation of an urban renewal district could help offset the loss of Emerging Opportunity funds. Distribution of urban renewal funds statewide has been held up until the Department of Revenue devises a rule for calculating the tax in the districts following a Supreme Court decision that the present method was unconstitutional. The case was Shilo Inn vs. Multnomah County.

Hare said he was optimistic about future budgets, but he added, "The process revealed that it's going to be even harder to provide the depth and breath of services we have now with our present general fund revenue source, the property tax."

He said, "We've been creative in coming up with new ways to find sources of income, such as by adding the ambulance service. But we'll have to look for major new revenue sources or decide what services we want to do without. And they have to be big sources, we can't just cut little programs. "We're going to see some changes in philosophy, both locally and at the state level. We need to be ready to make the tough decisions when we have to," Hare said.


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