The Richfield City Council discussed the possibility of raising property taxes, water and sewer rates at some point in the future during a meeting May 28.
The aging infrastructure of the city’s water and sewer systems and being able to keep up with the need for maintenance and upgrades is causing some major concerns, said Mike Langston, city financial director.
“Both systems, distribution and collection are aging,” Langston said. He said water mains and sewer collector lines are failing, or showing signs of failing, throughout the city.
While the city has completed some major projects in the past three decades building wells, replacing pumps and water storage tanks, little has been done on the pipes that sit under the city’s streets.
The city could apply for grants and other funding packages, but if rates are too low, it wouldn’t likely qualify, Langston said.
“There is a formula they use based on average household income,” Langston said. “We absolutely are not going to qualify for a grant for water unless we adjust rates.”
Langston said a rural water rate study should be completed before any decision is made.
“We have time to be patient,” Langston said. He said a study would help determine the amount of increase needed in order to qualify for grants for water improvements.
Aging infrastructure and other costs are cause to consider a possible property tax increase.
The city is still working with fewer people thanks to cutbacks made nearly a decade ago during the recession, Langston said. For instance, the public works department had 10 people, but is still working with nine.
“Our costs, including materials, have gone up 100 percent in some cases,” said Mayor David Ogden.
A possible increase in property taxes may also be on the horizon.
“They won’t raise them this year,” Langston said. He said in more than 30 years, the city hasn’t raised property taxes to deal with inflation or the increasing costs of materials and labor.
“We don’t want to be in a situation where we have to do a massive increase all at once,” Langston said. He said some neighboring local governments have had situations where they’ve had to double their property tax rates to keep up.
“We’d rather do it a little at a time,” Langston said.
One positive piece of news when it comes to the budget for 2019-20 is the last year’s reauthorization of the parks, arts and recreation tax, said Richard Barnett, councilmember. He said the council held off on spending much of its PAR tax funding awaiting the results of the November election.
The result is an approximate $300,000 surplus in the recreation fund.
“I propose that we retroactively put $100,000 of that into our swimming pool fund,” Barnett said. The city has been saving approximately $100,000 each year for an eventual swimming pool project. With the $100,000 from the current fiscal year, and another $100,000 from the upcoming fiscal year, the city would have $500,000 in the pool savings fund, Barnett said.
Another recreation issue, the new city park, was also discussed. The council agreed with a plan to continue development of curb, gutter, water and sewer lines this year, as the city has a community development block grant to defray the costs of those items.
In addition, the council consented to plowing the block to remove the weeds and planting grass, similar to what has been done in areas set aside for cemetery development.
This would allow grass to be established and to mature while keeping weeds down and giving the city time to decide exactly what needs to be done with the new park.
“As a city we have a history of pursuing whatever the latest project is,” Barnett said.
He said the city should consider being more strategic in how it spends its recreation funds, and consider funding a master plan.
“It may be the best $25,000 we could spend,” Barnett said. “It would give us some direction.”
In other business, the council approved a notice to proceed for the city’s street improvement project.
The $4.5 million project will address several streets throughout town.
“This was a brilliant move,” Barnett said. He said by leveraging several years’ worth of street improvement funding, the city essentially doubled its money and effectiveness of the project.
“We’ll have a payment for nine years,” Langston said. He said this will result in smaller scale road projects for the next several years, but that the current one will be able to accomplish a lot more.