Sean C. Morgan
The City Council approved a supplemental budget last week, transferring money from the general fund to the police and library funds to cover revenue shortfalls this year.
The city has had some $380,000 in unanticipated revenue losses due to compression. The supplemental budget moves more cash into the affected library and police budgets to help hold off deficits in those budgets in coming years.
Even with the transfers, both services will be in deficits before the end of their current operating levies, and the city is working with the League of Oregon Cities and other agencies to come up with ideas to ensure funding for library and police services in Sweet Home.
The supplemental budget, a mid-year change to the budget, recognizes $280,000 in unspent funds from the 2010-11 fiscal year, which ended on June 30.
That money was transferred, based on the council’s decision on Nov. 8, along with money that had been budgeted to go into the city’s building reserve fund.
The total budget transfers are $572,000 to the Police Department and $60,000 to the Sweet Home Public Library.
Compression is a term describing the effect of property tax limitations set by state law and approved by voters through Measure 5 in 1990. Property taxes are calculated on assessed values. When the values are compared to real market values, they cannot exceed $10 per $1,000 of valuation for general government services and $5 per $1,000 for education services.
Local option levies revenues on a compressed property are reduced first, followed by permanent rates, such as the city’s basic tax rate or the Cemetery District’s basic tax rate.
The reduction of tax revenue through this process is called compression. One property may be in compression while a neighboring property may not be. The difference is based on the tax rate and the gap between assessed and real market values. The closer the two values are, the less compression is caused.
In addition, the council also approved the transfer of $80,000 from the project and equipment reserve fund to make lease payments on police vehicles during 2011-12 fiscal year, which began on July 1 and ends on June 30.
The transfer reduces the project and equipment reserve fund to $1,072.
Voting to move the funds were councilors Marybeth Angulo, Mayor Craig Fentiman, Jim Gourley, Greg Mahler, Scott McKee Jr. and Ron Rodgers. Mike Hall was absent.
In other business, the council ratified a contract with the Sweet Home Police Department Emergency Services Union effective from July 1, 2010 to June 30, 2013.
The union ratified the contract on Nov. 1.
The settlement grants a 3-percent wage increase for the 2010-11 fiscal year, a 0-percent increase in 2011-12 and a 3-percent increase in 2012-13.
The contract may be reopened if revenues allow.
The wage increases for 2010-11 were budgeted in the current year, 2011-12.
Labor negotiations began in April 2010 and concluded on Oct. 25 with a tentative agreement. The last agreement expired on June 30, 2010.
The contract was scheduled for arbitration on Nov. 15. Avoiding arbitration saved the city an estimated $10,000 to $15,000 in legal fees.
Under the agreement, police officers receive $3,501 gross per month at the first step of their salary schedule, this year. At the top step, step five, they receive $4,255 gross per month. Beginning July 1, officers will receive $3,606 per month at step one and $4,383 at step five.
This year, dispatchers receive $2,728 per month at step one and $3,317 at step five. Beginning July 1, dispatchers receive $2,810 at step one and $3,417 at step five.
Employees are eligible for steps annually based on a positive evaluation. An employee receiving a positive evaluation annually may reach step five after five years.