Council reconsiders CIP, approves using terminal-tax funds to balance 2018 budget

The Superior Common Council voted Aug. 15 to reconsider and approve adjustments to the five-year capital improvement program (CIP) that redirect some revenue from the city—s oil pipeline terminal tax into the general fund to help balance the 2018 budget.

Council President Olson moved to reconsider the package previously voted down Aug. 1. The mayor and finance staff described the proposal as a planning tool that would change the timing on some CIP projects and shift funds so "part of it would remain in the CIP a little over 300,000 and about 200,000 would go to the general fund," with roughly $190,000 used to prevent a levy increase in the 2018 budget.

Several council members voiced concern about relying on terminal-tax revenue for operating balances. Councilor Olsen and others used the phrase "rob Peter to pay Paul" to summarize the risk; Councilor Sweeney warned of a "slippery slope," saying the city should look at cuts in spending rather than rely on terminal-tax transfers. Jean (finance staff) told the council the five-year projections are planning figures and "you don't have to" carry the suggested amounts forward if councilors later prefer different allocations.

The mayor placed the motion for roll-call vote; many councilors responded affirmatively and the motion passed. Supporters said the change balanced the 2018 budget without raising the levy; critics said the council should monitor the long-term effect on capital projects, especially economic development funding that previously ranked highly in prior allocations.

The mayor suggested scheduling additional discussion or a committee meeting focusing on the terminal tax and the future of the budget ahead of final budget adoption.