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Newberg budget committee reports stable funds, pays off debt and plans $32 million wastewater build
Summary
At a May 26 mid‑biennium session, staff told the Budget Committee Newberg’s fund balances are stable, an outstanding debt was paid using Butler property proceeds and red‑light camera revenue, and an oxidation ditch estimate rose to $32 million to be funded largely from wastewater SDC reserves.
The Newberg Budget Committee met May 26 for a mid‑biennium update during which staff said the city’s fund balances were stable and several financing moves were completed to reduce debt.
Katie (Presenter) told the committee that the city paid off a debt last week, supported by the sale of the Butler property and incoming photo red‑light revenue; staff described the day‑of payoff amount as slightly different than the earlier estimate and gave a rough payoff figure of just over $1 million. She said the photo‑enforcement system went live Jan. 21 and that proceeds from the program helped meet the payoff target.
The presentation highlighted that Fund 46, the wastewater system development charge (SDC) fund, holds about $15.7 million in reserves. Staff reported a revised estimate for the planned oxidation ditch project has grown from roughly $17.5 million to $32 million, citing construction inflation and an additional required secondary clarifier and pumps. Katie said the city intends to use the SDC reserve and inter‑fund lending from the water fund to avoid issuing external debt for the work.
Staff also recommended the committee not raise the property tax rate for next fiscal year and said the earlier forecasted 3% property tax increase would not be requested. The committee heard that reducing smaller wastewater debt first (an item described as just over $1 million) would produce a meaningful reduction in sewer charges because a significant portion of current sewer fees reflect debt service.
On benefits and long‑term liabilities, staff reported a substantial increase in health‑insurance costs: retaining the current plan would have produced a roughly 20% premium jump; an alternate plan limited the increase to 14% but raised copays. Staff noted employees currently pay none of the premium and said they would monitor affordability and recruitment impacts. Separately, the city’s legacy pension plan (outside PERS) covers about 25 members; staff said an actuarial forecast is requested because the plan will require different budgeting as members retire.
Katie closed by listing recent grant awards and reimbursements: $750,000 in congressionally delegated funds for treatment‑plant basin covers, $340,000 in FEMA funds for City Hall flood repairs, and a $225,000 donation from the Newberg Police Foundation for two drone trucks.
The committee asked for more public outreach about the payoff and budget health; staff said a press release and billing‑statement notice are planned. The committee will receive supplemental budget items next week and staff said the full next biennial budget will be presented in the next budget cycle in April.
The budget committee adjourned without a formal vote on the projects described; staff said policy choices (including any further land sales for debt reduction) will be brought to city council.
