After considering all funding options, Paonia trustees approved a 3 percent impact fee on the town's enterprise funds for inclusion in the 2018 draft budget.
The approval came during the annual public budget hearing on Nov. 14. The approximately $43,000 in fees will be placed in a separate street capital improvement fund. The fee will be imposed for one year, and will result in no rate increases to town water, sewer and trash customers. If approved in the draft budget, the board can re-visit the fee for the 2019 budget.
Similar to franchise fees towns charge private utilities for use of rights of way, the fee would be paid out of existing water and/or sanitation revenues to cover their wear and tear on town streets and alleys.
Town administrator Ken Knight suggested the fee in October at the start of the budget process. Knight said that while the fee may not be popular with some, he believes it is a rational decision for trustees to make. Money raised won't take care of everything, but it will add to an already slim budget, said Knight.
After early discussions, the fee was left out of the budget, with the caveat that it could be revisited before the board passes the final draft.
Trustee Dave Bradford, who made the motion, said he was initially opposed, but now sees things differently after grasping the concept of the impacts on enterprise operations to the town's streets. Bradford said he shares others' concerns about imposing a fee on those funds.
"I think it destroys the impetus to move forward on looking for other sources of revenue," said trustee Bill Bear. "What's to stop the town from asking for more later?"
Trustees considered new information in considering the fee. The town recently lost a police officer and may lose another. Earlier in the meeting trustees also approved renewal of employee health insurance coverage from Rocky Mountain Health Plan. Increases will increase insurance premiums by 46.3 percent and increase deductible and out-of-pocket costs while decreasing overall coverage.
Trustee Karen Budinger started the conversation about the fee, urging the board to consider using it to pay for additional staff. The board will propose an increase in sales taxes in 2018, but that won't help this budget, said Budinger.
While it was considered throughout the drafting of the budget, the fee was not included in the draft, noted Budinger. "This budget is so bare ... There is no slush fund, no provision for staff help. We just keep piling things on staff."
Chelsea Bookout motioned to amend and set one percent aside for staff. The increase in insurance premiums effectively reduces staff take home pay, said Bookout. With increased demands on staff, it's difficult for current staff to even take a vacation, said Bookout. The amendment was defeated in a tiebreaker vote by Mayor Charles Stewart.
Discussion of the budget will be on the Nov. 28 agenda. The board will present a resolution to adopt the final draft of the budget at the Dec. 12 public meeting.
Trustees also approved modification of the town's In-Town Water System Improvements project's Preliminary Engineering Report to add replacement of aging water lines in the 100 blocks of Dorris and Clark avenues to the project for 2018. Since the projects were not included in the original proposal, a public hearing on the modification was required by the Colorado Department of Public Health and Environment in order to qualify for a state revolving fund loan.
Cost of the project and installation of a pressure reducing valve is about $250,000, with funding already secured. The projects will go to bid in 2018.
The board also voted to award the Samuel Wade Bridge repair project to Tribble & Sons Construction, which submitted a bid of $16,299.50. Work is anticipated to begin between late November and mid December.