The City Council (CC) approved the 2017-2018 biennial budget 22 November 2016. There is a lot to say about that budget, but first, an update on the SSWM utility fees.
The CC increased the SSWM fees 15% for 2017, and did not act (yet) on the City staff proposed additional 12% increase for 2018.
Single family resident properties and condominium owners now are assessed $169 annually for stormwater fees. Businesses, the Park District, the School District, the library, churches, private schools, farms with large stables and/or barns, etc. are assessed $169 for each 3,000 square feet of impervious surface.
That can amount to a sizable chunk of money.
IslandWood $ 7,774
COBI, Prichard Park $16,565
St. Barnabas Church $ 3,551
High School, Admin, Ordway $56,446
The stated purpose of the SSWM fee increase was to pay for new capital projects, namely deep culvert replacements.
There is a smidgen of logic to that since the estimated costs of replacing deep culverts may exceed $1 million each … and up to $5 million or more if a fish lives somewhere in the waters that flows through the culvert. You can blame the Department of Fish and Wildlife hydraulic permit rules for those ridiculously high costs for high end stream simulation culverts, meaning flowing water isn’t supposed to touch either side of the culvert in a 100 year flood scenario.
But the City added staff being paid by the SSWM utility to support a number of discretionary programs that don’t contribute anything useful to the SSWM utility.
In actuality, the SSWM fee could and should have been lowered if the City would stop paying for programs and consultants that have nothing to do with the original intent of a stormwater utility, and that intent was to pay for stormwater infrastructure and maintenance to prevent urban flooding by having a municipal stormwater (MS4) infrastructure system such as storm drains and storm water piping, ditches, and retention/detention ponds, and discharging stormwater that is as free of pollutants as reasonably possible.
This City, admittedly along with some others, have expanded the utility from it’s state law initial to include any number of Clean Water Act and other discretionary programs. No problem with that if those programs would actually clear up water quality problems or reduce urban flooding, but they don’t. City Council seems simply oblivious to what they are really spending utility money on and how ineffective those programs are as they are currently being administered.
And the City’s overhead charges are significantly too high … somewhere in the 60%-70% range.
The one positive action the City Council did for the SSWM utility is earmark $50,000 for a SSWM efficiency study, likely initiated because of this blog and six years of messages and committee public comments that the SSWM utility needs to be reigned in and made efficient.
It’s a reflection on management that this City can’t itself discuss and figure out what a proper and cost efficient level of personnel is needed to run an enterprise fund business that has fewer than 10.5 employees. And it’s an even scarier proposition to think this City is even considering taking on a much larger electrical utility!
Some citizens remember the COBI’s water utility was cost allocating 9.6 FTE (Full Time Equivalent employee) to the water utility and the City had excessively high water rates. The City was forced by a citizen lawsuit to do a competitive study, and a consultant hired to do an efficiency study concluded the water utility could be operated with 3.9 FTE. Our City Manager objected, but reluctantly agreed to 4.2 FTE. Water rates were subsequently reduced by more than 60%, and the water utility, although now with 4.7 FTE, is still operating at a revenue to expenditure break even level.
SSWM has a similar excessive cost allocation problem. Too many employees being charged to the utility, and programs in the utility that are either not effective or are being paid for by the SSWM utility when they more properly should be paid for by the general fund.
An average City employee now costs in excess of $133K a year, and so every FTE charged to the utility is a significant expenditure.
The City Council also decided to keep the 6% tax on the SSWM utility, although at least three Washington court decisions have ruled what can be taxed is the proprietary functions of a utility (think business sales, like water service or sewer service), and not general government functions, such as sweeping streets or measuring bugs in streams or maintaining the City’s weather station. Virtually all of what the SSWM Fund pays of a general government nature … after all, the SSWM fee itself has all the characteristics of a general tax since the City doesn’t provide any specific service or product to the individuals who pay the fee … it’s a utility to pay for the City’s MS4 system maintenance and operation, which is City owned public infrastructure.
It’s an interesting circus of decisions at City Hall.