The city of Brookings Budget Committee unanimously approved a $19.8 million budget as well as a $2.98 million urban renewal budget.
The two budgets will now be forwarded to the city council and Urban Renewal Agency Board for adoption May 28.
The city’s debt — most of which was for water and wastewater system improvements and construction of the treatment plant — is $14.56 million. Most of it is financed at a long-term fixed interest rate of 2.5 percent, said Finance Director Janell Howard.
Howard and City Manager Gary Milliman reviewed five benchmarks used in government financing to determine if an agency is overloaded with debt; Milliman said the city is well within all of them.
Households should see an average increase of $3.75 a month in their water and sewer bills as the budget calls for rate increases of 3.96 percent and 4.9 percent respectively. Those go into effect July 1.
Howard said the rate increases are needed to fund water and sewer system operating cost increases and a shift of debt service costs to ratepayers.
“This is the last year we’ll be using System Development Charges (SDCs) — fees paid in past years by new development — to make payments on the wastewater treatment plant construction debt,” Howard said. “This debt will now be paid entirely by ratepayers.”
If construction sees a rebirth in the area, the city could revert to the SDC payment method.
No water or sewer revenue is used to fund law enforcement, Milliman said, after comment to that effect was made in a recent city council meeting.
“The city ended the long-standing practice of charging a franchise fee to the city water and sewer utilities several years ago,” he said. “The franchise revenues were used to pay for general government services including police, fire and parks. They’re not used exclusively for water and sewer operations, capital projects and debt service.”
The major capital project in the proposed budget is $690,000 to build a retaining wall next to the city’s wastewater treatment plant where a slow-moving landslide could threaten key operations at the site.
Public Works Director Loree Pryce said the city has applied for a federal grant, but the status is unknown.
Other expenditures include $840,000 for storm water, sewer and water system repairs, $200,000 for replacing or lining old water and sewer mains and $250,000 for street improvements.
State officials recently notified the city that employee retirement costs will increase by just more than $100,000.
The consolidation of various departments last year will save the city money. Merging the police and fire departments will result in an annual cost savings of $60,000 and placing public works and planning together has saved that budget $30,000.
Municipal court revenues are up significantly since the court began handling traffic tickets last year. The city anticipates revenues of $50,000 and expenditures of $23,426 this year. That compares with revenues of $1,532 and expenses of $15,779 in 2011-2012.
“These changes have worked out very well, both in cost savings and improved operations,” said Mayor Ron Hedenskog.
The budget committee also reviewed a three-year capital improvement plan to replace aging water mains and rehabilitate sewer mains, each at a cost of $100,000 a year. That plan includes development of a new well on the Chetco River in 2015-2016 and replacing a major water main in 2014.
The proposed budget estimates there will be a balance of $625,709 in the general fund as of the end of next June, exceeding the council’s goal of maintaining a 5 percent reserve.
The Urban Renewal Agency budget includes $449,000 in payments on a $3.4 million loan the agency obtained for downtown improvements in 2010; it also anticipates another $1 million in debt to pay for the local match to reconstruct Railroad Street in 2016.