A handful of District residents were on hand for the public hearing on the JIPSD Budget Monday night. Most asked the Commissioners to reverse last year's tax increase.
The Commissioners were concerned about the proposed increase in sewer fees. There is currently a $83,000 deficit on sewer operations. The Vice Chair of the Commission, Kathy Woolsey, argued for a more modest increase in rates than the staff proposal. She said they should close the deficit, but not raise rates so much that they started to run a substantial profit on sewer operations. The District's new Chief Financial Officer (CFO), along with the district's auditor, said that they had to increase the rates as proposed because bond investors required a surplus in order to build up a reserve. (The material distributed showed no need to increase the reserve this year and also showed that the proposed rate increases over the next five years would generate a much larger increase in reserve than the minimum required.) The CFO also said that the Commission must approve the increase tonight because it was tied to the rest of the budget.
The Commission voted to approve the rate increase as proposed by staff, but they sent it to the wastewater committee to review it and see if a smaller increase would be sufficient. Since the increase doesn't go into effect until October, they felt they had time for a second look. The Vice Chair said that she thought they she deal with the matter tonight, but as Chair of the Wastewater Committee, she would schedule a meeting soon.
The Vice-Chair had distributed to the Commissioners, the staff, and the public, ten different amendments to cut spending and roll back taxes. When the budget came up, she made a motion to amend the budget. Before she could actually propose anything, the Chairman, Alan Laughlin interrupted and asked her to withdrawal all of her proposed amendments. The Chairman said he was going to send the budget back to the Ways and Means Committee. He didn't think amendments to the budget should be considered at the regular meeting. The vice-Chair pointed out that he did not have the authority to do that. The Commission's Parliamentary Attorney said that she didn't remember if he had that authority, but that the Chair, like any Commissioner, could move that the budget be returned to Committee. He made that motion, it was seconded, and it passed.
Soon after, staff insisted that the Commission must approve first reading of the budget because of the need to advertise the public hearing. The ad must include some figures from the budget. So the Chair moved to bring the budget back up and that passed. The Vice-Chair again moved to amend the budget. The Chair threatened to adjourn the meeting if she continued. Commissioner Platt moved to adjourn and the Chair seconded. The motion to adjourn the meeting failed.
Vice-Chair Woolsey then moved to amend the budget to reduce the debt service millage from 9.3 to 7.3 mils. The proposed amendment matched that reduced revenue by cutting "future capital leases" to zero and also the surplus increasing the balance in the debt service fund to zero. The District's new Chief Financial Officer said that the amendments cut taxes without cutting spending and violated the requirement of a balanced budget. The vice-Chair said that that was not correct and asked the CFO to look at the sheet she had provided. He refused and said he knew the numbers. The Commission approved the amendment 4 to 3.
Commissioner Engleman said she was going home if they didn't go into executive session right away. The Commission then voted to go into executive session to get legal advice. The Commission's labor attorney stayed and everyone else had to go outside and wait--for a long time. Commissioner Engelman left the executive session and went home. After a while, the executive session ended and everyone returned. The Commission then voted to recess the meeting (it was about 10:30) until the next day at 7 PM.
When the meeting resumed on Tuesday, the staff had brought the District's bond attorney to advise against the amendment because of bond investors. Chairman Alan Laughlin then proposed to reverse the amendment passed at the last meeting.
The bond attorney said that the District really cannot zero out the balance in the debt service fund. The Vice-Chair pointed out that the amendment did not zero out the balance in the bond service fund. She read the amendment which zeroed out the surplus, which would mean that the balance in the bond service fund would stay the same rather than increase. The bond attorney looked at the CFO and then said that he had misunderstood the amendment.
The CFO said he didn't know where the Vice Chair got her numbers. She responded that she had gotten them from him. (They came from the draft budget.) She asked if he had provided wrong numbers. He responded that he was offended that she suggested that he provided wrong numbers.
The Vice-Chair said that she understood that the usual practice by local government was to first borrow money and then have the County Auditor place the millage on the tax bill needed to pay it back with interest. The bond attorney said that was true. Commissioner Woolsey pointed out that the District doesn't doit that way and has been collecting money from the taxpayers before they even knew how much the new fire station would cost, much less the debt service on the money they would borrow. The bond attorney looked stunned and said that he guessed that it can be done that way.
Vice Chair Woolsey then pointed out that the staff had been there last year when over 75 people crowded the hearing to protest the tax hike. They were well aware that every Commissioner up for election who voted for the tax hike was turned out of office by the voters. The newly elected Commissioners were all very critical of the tax hike. Even so, the staff prepared a budget that left the tax hike unchanged. She said if the Commission voted to reverse the amendment, she would make a motion to return the budget to staff with instructions to cut taxes by 2 mils. Commissioner Platt said he would second that motion.
The Commission voted 5 to 2 to repeal the budget amendment that had passed the previous night. Vice Chair Woolsey and Commissioner Brown Crouch voted against repeal.
Commissioner Woolsey then moved to return the budget to staff with the instruction to reduce the property tax by 2 mils. The motion was seconded by Commissioner Platt. It passed unanimously.
The first reading of the budget was defeated 5 to 1. Chairman Laughlin was the sole vote in favor. Commissioner Engleman had left the meeting early.
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