Rate and fee increases were topics of discussion during an all-day budget work session in Cedaredge on Aug. 27.
The trustees' discussions all had one theme in common — increases in both water and sewer charges for Cedaredge users are on the table.
No decisions were finalized during the meeting, and the 2014 spending plan won't be finalized until December.
Uppermost in the minds of trustees was how to find money to build a new sewer treatment plant. Trustee Larry Smith noted the difficulty of the town's situation being caught between state health department regulations and the town's nearly tapped-out local rate payers. Smith said, "We need the publicity that we have to get $500,000 in two and a half years, and that we have been mandated by the state to put in a new sewer plant in five years."
Smith's reference to $500,000 is the amount of money town staff says will be needed as matching funds to obtain grants for the plant.
Asking the question, "What are we going to do to raise the money we need," Trustee Gene Welch reminded the board that the town can transfer up to ten percent of its general fund budget to the sewer fund each year. That was done "to support the golf course when it needed money," he said.
Town Administrator Katie Sickles replied that the golf course transfer was possible because at the time the general fund had extra money from its sale of water shares to the water fund.
It was stated that Welch's fund transfer idea could raise $47,000 per year, if any extra money for it can be found in the general fund now.
Another idea was the addition of an additional $6 surcharge to monthly sewer bills; it would come on top of the $6 surcharge imposed only last year. The combined $12 per month would raise an estimated $180,000 to $190,000 per year, trustees said, or $450,000 to $475,000 in two and a half years.
Mayor Pat Means said, "We should think seriously about raising sewer fees."
Welch added, "The question is how much?"
Water rates came under discussion also during the day-long budget workshop. (See related story on town water loss.) Town Administrator Sickles noted, "We have large capital improvement expenditures coming through the water fund." There is currently over $120,000 in capital spending targeted in the water fund for 2014 and 2015. The budget foresees $536,000 in water user fees for 2014.
During the discussion on water, Trustee Smith said, "I am not in favor of raising rates because they have been raised several times in recent years."
Means said, "Raising the water and sewer rates is what we have to do."
There was also conversation about the town's two-percent sales tax, considered by board members to be among the "lowest in the state." (The town also has a one-half cent levy that pays for street improvements.) Means said that a one percent sales tax increase would raise about $180,000 per year. The board's discussion of a sales tax increase ended abruptly with a reference to the electorate's strong anti-tax feelings.
Because of TABOR, the town would have to ask voters for permission to increase the sales tax.
Town Administrator Sickles provided the Delta County Independent with an example of Cedaredge's sewer plant funding needs. The example is taken from a recent funding idea that did not move forward:
• A $2 million loan with debt forgiveness;
• a $1 million potential grant;
• $500,000 in town matching funds;
• $100,000 in miscellaneous grant funding to build a $3.6 million mechanical sewer plant.blog comments powered by Disqus