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City consultant warns of multi-hundred-thousand-dollar shortfall; proposes 12% water-rate increase
Summary
A contracted financial consultant told the council operating costs outpaced revenues (63.4% since 2021), described exhausted utility reserves and outstanding invoices, and proposed a package including a 12% annual water-rate increase for up to five years plus a 3% utility-tax increase to restore reserves; council and residents debated timing and impact.
The citys contracted financial consultant presented a multi-part review of bookkeeping gaps, fund balances, and options to restore solvency. "Operating costs have increased by 63.4% since 2021," the consultant said, and she reported a combined deficit in utility and general funds that requires action to avoid missed payroll or service reductions.
The consultant proposed increasing the water base rate by 12% for multiple years (with annual re-evaluations), a one-year 12% garbage increase then 2% thereafter, and a 3% increase in the utility tax directed to the general fund. Staff modeled that the combined package would raise roughly $101,000 for utilities and $72,000 for the general fund in the first year, and aimed to rebuild reserves over five years. The proposal also recommended not filling several open positions to reduce payroll costs; staff estimated not filling two public-works positions and one clerical vacancy could recoup about $252,000 across funds.
Council members and many residents questioned the size and immediacy of the proposed hikes and asked for alternate packages and more time for analysis. Multiple residents urged staged increases or spending cuts (park watering schedules, lease decisions) instead of a large immediate jump. Staff emphasized that enacting rates would require ordinance updates and that the councils vote is the required legal step; no rate ordinances were adopted at the study session.
