La Plata continues budget work

On May 16, the La Plata Town Council held a work session to continue discussing the Fiscal Year 2018 Budget, specifically the increased rates and fees in enterprise funds.

As promised in last week’s work session, Town Manager Daniel Mears and Town Treasurer Robert Oliphant presented the town council with examples of a residential bill, compared to a residential bill showing the projected increase in water, sewer and maintenance rates as proposed by staff in the FY18 Budget.

“The typical bill we utilize 14,400 gallons of consumption. We put together an analysis of what the current rate is and the proposed rate would be according to the staff’s recommendations. It would be an overall increase of 1.98 percent for a typical residential bill.,” Mears said.

In the enterprise funds, staff recommended a reduction in the sanitation fee of 5 percent, water rates to increase just over 11 percent, and sewer rates to increase just over 4 percent. Mears said the increase in costs associated with the water and sewer fees is due to the increased cost of providing those services.

Mayor Jeannine James asked, “Have we cut out all the fat that can be possibly cut for the utility bill? Is there any way that we can keep costs down, and is the quarter increase going to make or break us?”

“I like the fact that we can adjust the budget during the year, but I don’t like that we’re charging customers anywhere from $24 to $40 more a year on our projection,” James said.

Oliphant said it doesn’t make or break the town, but there will be ramifications. “We believe it is the lowest that we can go reasonably to be providing the service that we’ve been providing this quarter,” he said.

Director of Operations Robert Stahl said maintenance is significant because electricity and chemical costs go up.

“The state has steady mandates that get tighter and tighter on discharge permits and environmental ventilation,” he said.

Mears said the town has always focused on preventative maintenance.

“There are ways we can reduce some of the costs but a lot of the expenses are maintenance items. Could we lower this number by $30,000? ... Yes, but we don’t know or foresee whether that would be detrimental in the current year,” Mears said.

Councilman Brent Finagin said he noticed the budget goes up regardless of a growing surplus.

“It seems counterintuitive to me that you would increase the budget for a line item that’s producing larger and larger surpluses every year,” Finagin said.

Oliphant says the surplus stays in the fund balance.

“However, if we keep doing that, we are going to be in a deficit situation when we do the annual financial report. Right now we have a fund balance of $1.2 million. In four years we will be $4.8 million in the hole. That’s if we kept going as we are. My projection is that the council will be raising rates every year for the consumer for the next five years,” Oliphant said.

“I understand that it has to be raised this year but I don’t understand why there is no way that we can rectify this. The perception from consumers is that we’re just raising rates every year and coming after them, but that’s not the case. They see that their rates creep up with no end in sight. But it also seems that if you put it off for a year, you pay the price,” Finagin said.

Oliphant said raising this year’s rates by 20 percent would most likely solve that problem.

“I don’t like that we’re increasing the rates every year, and that can be one of our goals for next year to find ways to save, but if you did more now then you would have to do less later,” he said.

Councilman Matthew Simpson agreed, stating, “Add it all on now to save us later.”

James and Councilwoman Emily Mudd-Hendricks disagreed.

Councilwoman Paddy Mudd said the average resident does not understand the budget as well as rates — not property taxes — being raised. She said it appears to be a public relations issue.

Oliphant agreed, stating, “As you all are citizen legislators and probably feel the same way I do, as a citizen who gets utility bills, we don’t understand it, but we can work together on a way to convey this to the general public.”

The general consensus of the council was to approve of the utility rates presented in the FY18 budget with an extra 2.5 percent increase in sewer.

The public hearing for the Town of La Plata’s FY18 budget will be held 7 p.m. May 30 at town hall.