Depoe Bay budget committee reviews capital improvement plan, water priorities and transient lodging tax allocations

The Depoe Bay Budget Committee took an extended briefing on the city's draft Capital Improvement Plan (CIP) and a proposed budget; the discussion focused on how to prioritize water and wastewater projects, how much to budget for infiltration and inflow (I&I) work, the planning versus binding nature of the CIP, and how the city's transient lodging tax (TLT) revenues have been allocated over time.

City staff and the city engineer presented the CIP as a planning tool that combines multiple master plans (water, sewer, transportation, parks, harbor) to show projected needs and rough cost estimates. City staff said the document is “a planning tool, not a legal mandate,” read aloud during the meeting, and emphasized that “the CIP is a forecast, not a promise.” The city engineer’s draft lists multiple projects with a FY‑by‑year footprint; staff noted a FY 25‑26 summary figure of $6,225,000 in the draft but said the budget committee and council would decide which projects to fund.

Committee members questioned large master‑plan estimates and asked staff to focus budgeting on the 0–5‑year priority column. One recurring point: staff currently budgets approximately $80,000 per year for I&I (infiltration/inflow) assessment and reduction work and said annual averages so far have been about $50,000–$60,000; the master plan figures would imply larger multiyear investments. Staff said the master plan shows a multi‑year need that can be phased; the committee discussed whether to commit design dollars now (for example, water‑treatment improvements) and leave major construction to grant cycles.

John Christensen, identified in materials as the city engineer with AKS Engineering, explained the CIP cost estimates are current‑day estimates rather than hard bids and that actual bid prices can differ. Committee members asked for clearer breakouts of what the $500,000 or higher figures would accomplish in a given year and urged focus on water/wastewater because “the city doesn't run without water.” Committee discussion noted planned design work this year (for water treatment improvements and some park and street design) and that major construction will likely require grants.

The committee also discussed several capital‑scale items flagged in the CIP: a potential modular restroom or restroom site study for a parking lot behind the Horn (engineering and ADA constraints were raised), a partial Shell Avenue city‑park design, and repainting or aesthetic work on a visible water tank (committee members gave wide ranges for repaint quotes and noted paint and contractor availability can vary). One staff estimate discussed during the meeting suggested a limited engineering/survey cost of roughly $5,000–$6,000 to test a restroom location; repainting the tank was discussed in the range of “over $100,000” to higher depending on scope.

Transient lodging tax and allocation: staff presented a multi‑row spreadsheet showing earlier local allocations (so‑called "grandfathered" amounts) plus the portion that is subject to the state's 70/30 tourism‑spend rule after TLT increases. Staff used example budget numbers to explain the split: with an estimated $1,600,000 in TLT receipts, roughly $1,127,000 was described as available to the general fund (including grandfathered amounts and the city's share of the 70/30 split) while the state‑restricted tourism share would be about $384,010 that must be spent on tourism‑related facilities or promotion. Staff noted an ordinance allocation that designates approximately $137,506 to public safety (law enforcement) and said the city has collected larger cumulative balances in tourist‑related and law‑enforcement allocations that need clearer historic accounting. Members expressed concern that some tourism‑related expenditures in past years were not clearly labeled in TLT accounts and urged better transparency on which projects were paid from which fund.

The committee also reviewed elements of the proposed budget such as staffing (a proposed city planner and a CPA contract for audits/financial services), decreases in some revenue lines (notably lodging tax and franchise fees compared with last year), and a request tied to law enforcement staffing: the sheriff's deputy package discussed at the council includes salary and a vehicle; the vehicle cost was questioned in the meeting (one line referenced roughly $73,000 for a vehicle). Staff said some items are prorated by start date and that they will return with corrected transfer lines for TLT and urban renewal as follow‑up.

No final budget appropriation was made; staff requested committee members send specific line‑item questions in advance of the next meeting so staff can supply answers ahead of council adoption timelines.

Quotes (selected): “It's a planning tool, not a legal mandate. The CIP is a forecast, not a promise,” read city staff. “If you focus on the 0 to 5‑year priorities you cut out a lot of other things that we don't need to worry about right now,” said a committee member urging water/wastewater prioritization.

Next steps: staff will refine CIP line items and provide additional detail about the most urgent water/wastewater projects, clarify which capital items are included in the proposed operating budget versus grant‑dependent projects, and produce corrected transfers for TLT and urban renewal prior to the next meeting.