The Philomath City Council is proposing a $17 monthly “Public Safety Service” fee be levied on each household and business in the city in order to shore up the general fund. This fee would be included on individual utility bills.
The term “public safety service fee,” coupled with several references to the Police Department in the city's February newsletter, leads one to believe that without the income generated by this “fee,” our community will be unsafe. However, the truth is, as confirmed in the Feb. 13 City Council hearing, the extra revenue would go into the general fund for other expenditures as well. Why not call it the "General Fund Fee?" Perhaps because it does not sound very dramatic nor does it have any scare tactic value?
Is it appropriate or even legal to attach it to a utility bill? If one gets behind in paying one's utility bill and the water is shut off, then one is deprived of water when in fact only part of the bill is for water consumption, sewer services, etc. That is just wrong.
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It is called a fee but in reality it is a tax and as such it should be billed out as a tax so that citizens and businesses can deduct it on their income tax.
Property taxes are a large source of city revenue and they are capped at a 3 percent increase annually. The economy has been growing slowly over the last few years: 1.26 percent inflation rate for 2016, 0.12 percent for 2015, 1.62 percent for 2014. Compensation for state and local government employees increased by 2.4 percent in 2016. These figures indicate that tax revenue should meet and even exceed the cost of employee compensation increases and the increased cost of materials and services. It is important to note that the general fund also receives revenue from other sources as well, such as franchise fees, cigarette and liquor tax, state revenue sharing and so forth. However, the city seems to dwell on the fact that the only way to increase general fund revenue is to increase property tax revenue via increased growth.
The newsletter makes reference to the fact that Philomath has limited potential for growth and therefore, has little opportunity to increase property tax revenue. Three new businesses opened in Philomath in the latter part of 2016. An 80-90 unit high density development is scheduled to break ground on 19th Street in May. As a result, the city will be paid system development costs by the developer and tax revenue will be generated. Two properties on Houser Lane were rezoned from industrial to high density in the latter part of 2016. The Skirvin property has been annexed by the city and zoned single family residential. Of course, the zoning designation can be upgraded by the city at any time. Obviously, there is growth and potential for growth. However, growth is a only a part of the answer to our budget “crisis.”
This financial “crisis” did not happen overnight but now, in the 11th hour, 59th minute, the city wants the citizens to bail them out. Instead of threatening citizens and businesses with an unsafe community the city of Philomath needs to cut expenditures. I would also recommend that city officials hire a city planning consulting firm that specializes in growing cities similar in size and culture to Philomath: the caveat being, growth equals more infrastructure and resource requirements, which equals more city expenditure. The fact remains, astute budget management never goes away despite increased revenue. The city of Philomath needs to be held accountable for its fiscal health instead of laying the burden on its citizens and businesses.
