05.28.19 Council Minutes – Special Meeting

At the City Council
In and For Said City
May 28, 2019
Minutes of the Richfield City Council special meeting held on Tuesday, May 28, 2019 at 6:00 p.m. in the Council Chambers of the Richfield City office building located at 75 East Center, Richfield, Utah. Mayor David C. Ogden presiding.
1. ROLL CALL. Present: Mayor David Ogden, Kevin Arrington, Bryan Burrows, Richard Barnett, Kathy Christensen, Connie Nielson, Matt Creamer, Mike Langston, Michele Jolley.
2. PROPOSED BUDGET FOR FISCAL YEAR 2019-2020 DISCUSSED. Mr. Langston reported that we have received the certified tax rate and we had about $7,000 to $8,000 in growth that we had not budgeted for, so that has been now been included. The increase in salaries was also included as well as an increase in the airport budget for the fuel sales and an increase to the street budget of $180,000.
Mr. Langston discussed how much a 10% property tax increase would generate, not that he was suggesting the Council do this; but so the Council would have an idea how it would affect a homeowner or a business. A residential property is taxed at 55% of the assessed value. If you had a home assessed at $100,000, the taxes currently would be $95.87 for the year to the City. If this was increased by 10%, then it would be a $9.50 increase on $100,000. A business is taxed at 100% of its assessed value, so a business valued at $100,000 would pay $174.30 per year. A 10% tax increase on that business would be an additional $17.43. For the entire year, a 10% tax increase would generate a little over $75,000 and if you were to have it split like we split the recreation tax and general operations tax, then $54,000 would go to the general fund and $21,000 would be transferred out for recreation purposes. The Council could designate the whole $75,000 to be put in the general operations and not have it split.
Councilmember Burrows stated that if we are going to increase water rates, then he does not think we should increase taxes too. Mr. Langston stated that he provided the information because it was something the Council discussed at the last meeting and he wanted them to be aware of what kind of funds we would be talking about. He also stated that we would be better off to make small increases to taxes rather than a big one. There has not been a tax increase, other than the recreation tax, for over 30 years.
Councilmember Arrington wanted to know if we needed the $75,000. Mr. Langston stated that it depends on what the Council wants to provide another man at the golf course or not because he does not have any other funds to take from anywhere. Mr. Langston noted that in the last 3 years, the cost of living index has gone up 5.8% in the last 3 years and probably more than that for construction materials.
Councilmember Nielson felt that we had a very good discussion last meeting and there are a lot of things coming up and we are close to our budget. She was under the assumption that we were repairing or replacing so many water lines or so many sections of water lines per year. Councilmember Burrows recalled that we put some money away for this. Mr. Langston stated that we did. The Council put aside $20,000, but it does not go very far.
Basically, we are just putting out fires rather than up grading in any way. Councilmember Nielson felt that we need to be a little more aggressive because we are going to get to a point where we are going to be in a difficult situation if we do not.
Councilmember Burrows stated that if there are that many water lines that need to be replaced then we need to identify them and see if we could put a project together to start fixing or replacing them. Councilmember Barnett stated that even if you put a project together or start fixing lines on a regular basis is not going to put out the fires. We are still going to have to deal with unforeseen repairs. Councilmember Christensen stated that some of the pipes could last another 80 years. Councilmember Burrows would rather do one big project and get some costs on how much that would cost.
Mr. Creamer stated that we have talked about a big water purchase and the need to find funding for that and it might be an opportune time to do the same thing on some distribution system repairs and factor that in with any rate increase.
Councilmember Nielson was concerned about the amount of water we are losing. Mr. Langston stated that we pump almost 900 million gallons per year and we probably only account for 700 to 750 million gallons, so we are losing 15% to 20% and that is not uncommon. Councilmember Barnett did not feel that the water being lost is not really an out of pocket cost. It could be a depreciation cost, but we do not have to pay someone per gallon for that water.
Mr. Langston noted that the aging of the sewer system was also discussed at the last meeting. We are starting to see aggregate and gravel because they are concrete lines, so it is likely those lines are beginning to degrade. The collection system at the lagoons is great, but we do have a problem with one of the holding cells right now. Councilmember Christensen worries about doing a property tax increase and then raising the water and sewer bill all in the same year. If there is a chance that we will need to increase the water or sewer rate, then we ought to hold off on the property tax for another year.
Mayor Ogden stated that it seems like when we go to the CIB there is always some relationship that there are interested in as to what we are charging for water and sewer. Mr. Langston stated that our rates are to be based on a percentage of the average household income. In our area, the rate charged should be about 1.75% of the moderate income. So the bill should be about $50 a month and ours is only $19.50 plus overages. An average home would probably pay about $25 or $26 a month for water. As Mr. Creamer stated, we would absolutely not qualify for a grant for a water project. They would probably loan us money at their rate which is 1.5% to 2%.
Councilmember Barnett stated that there are 3 things he would like to see in the budget. He would like to go back and retroactively put $100,000 in the capital improvements budget for the swimming pool for this fiscal year and another $100,000 for the next fiscal year like we have done for the past 3 years. The other thing is that he feels we should give the golf pro another employee. He would like to find some way in the budget to get the assistant pro. He would like Mr. Mullen to show the Council how he would propose to pay for that. Part of it could come from part-time employees because the assistant pro could take some of those shifts; part of it out of the recreation budget; part of it in increase. He does not know the answer. He believed that if we are going to have a golf course, it needs to be run properly.
Councilmember Christensen asked if there is $100,000 for this year that could be put into the swimming pool capital facilities fund. Mr. Langston stated that there is not quite $300,000 in the recreation fund for carry over for this year. That would leave $200,000 and $100,000 would go to the pool. Next year you would just have to put the $100,000 more and it would reduce what we have to spend.
Mr. Langston stated that those funds have been used for equipment because we do not have the money in our operational fund to pay for equipment. The other thing that always comes up is that we lose a pump either at the pool, the parks or the golf course.
Councilmember Nielson asked if we would be able to get by on $200,000 until next July if we did transfer the $100,000. She asked if the overage in the pool budget would come out of those funds. Mr. Langston stated that the overage would be absorbed in the operational budget.
Mr. Langston stated that the estimate on all of the department budgets is high, so they will come down to the actual cost before we close the budget.
Councilmember Arrington asked if the $300,000 was budgeted in next fiscal year as a carry-over. Mr. Langston stated that it was. Councilmember Arrington asked if it was going anywhere specific. Mr. Langston stated that it was not going specifically anywhere. Councilmember Arrington asked if once something is shifted into a capital improvement fund, if it would be used in the event of an emergency. Mr. Langston stated that you are not supposed to.
Councilmember Nielson asked about the equipment we talked about last meeting and if that had been budgeted in. Mr. Langston stated that he put money into the airport for a truck and the street sweeper was already included and so was the mini excavator. We are also going to fund another 2-ton truck or a new bed for the 10-wheeler, whichever is the highest priority.
Mr. Langston does not know if we can come up with the right numbers in time to make the assistant pro part of this budget, but we can open the budget and amend it at any time. We need to study this and get with Mr. Mullen and figure out how much we could save from part-time salaries and maybe see what else we could come up. That way we could deal with it when we have some good numbers. The consensus of the Council was to put $100,000 into the capital fund for the swimming pool.
Councilmember Nielson asked about the swimming pool budget for next fiscal year and if it had been adjusted. Mr. Langston stated that he had adjusted it up significantly over last year’s budget, but less than what we are estimating this year to be. We are going to have to get with the manager and find a way to do things and manage things to keep it on budget. Mr. Creamer suggested that we may need to cut hours at certain times of the year to make it work. We will try not to do that, but we did have an unexpected overage in the expense for gas which will not happen again. Councilmember Christensen asked if the manager is aware that the budget is way over. Mr. Creamer stated that the manager is aware of the budget situation. Councilmember Barnett wondered if the pool was opened more than it was previously opened. That is part of the additional costs. The schedule has become much more user friendly in that people do know when they can go swimming and it does not change by the day or by the month.
3. NEW 500 EAST PARK DISCUSSED. Mayor Ogden noted that there was some discussion about a week ago about possibly putting the park into grass initially and then analyzing the different potential uses for it. This is similar to what we did at the cemetery and it has worked really well.
Councilmember Barnett clarified that the funds we have received currently will bring water into the park. Councilmember Burrows stated that the grass and sprinklers that we put in at the cemetery was not that expensive. Councilmember Barnett would like to see this done initially because it is very inexpensive and would create a park, but he would also like to see a recognition marker for the Nielson family at this point so that they are recognized immediately . We could also put in some benches around. It does not have to be anything fancy. Then lest put together a plan. In his experience on the Council, every time a decision is rushed, we get in trouble. Councilmember Burrows stated that it is easy to take grass out. Councilmember Barnett does not want to do this park. We did take public input, but not for the purpose of doing something in the next 5 minutes.
Councilmember Burrows stated that something has to be done this year, because if not we are going to spend a ton of money to keep the weeds down. Mr. Creamer stated that this is going out to bid next week and should begin sometime in August. We could run a blade across it now to knock down the weeds and then we could plant grass in the fall.
Councilmember Barnett felt that this would be a nice looking, non-committal way to deal with that property in the short-term.
Mr. Langston stated that in 3 or 4 years we might be able to get another CDBG grant to further the development of the park.
Councilmember Nielson thought this would be a great idea to give us the opportunity to figure out where we should go with this so we are not sorry down the road. Councilmember Barnett felt that we need some direction for our recreation infrastructure and not just drop everything for the latest and greatest project that comes up. Consequently, he does not think we are getting the most use out of our available resources because we are not organized. Councilmember Burrows stated that we need a priority budget. Councilmember Barnett stated that there was an article in the Reaper last week about a recreation master plan. When it came before the Council, the Council did not want to spend money on this. Councilmember Barnett suggested that this might be the best $25,000 we could spend from that recreation budget to give ourselves some direction.
Mayor Ogden asked if the Council was in favor of putting down grass and knowing that the grass could be taken up and that the grass would be a vital part of whatever we decided the park should be. He felt that we should come up with a cost of what it would cost to level it, put in the sprinkler lines and the grass. Councilmember Barnett noted that what we did at the cemetery amount to more than what would be done on just a City block and it was not that expensive. Councilmember Burrows pointed out that the City crew did that project and they could probably do this fairly easy as well and hiring someone to level it would not be expensive.
The cost to do the property at the cemetery was under $14,000. Mr. Langston recalled the cost of the seed to be around $8,000. The area would still be usable space.
4. MEETING ADJOURNED. At 7:02 p.m., Motion: Adjourn, Action: Approved, Moved by Kathy Christensen, Seconded by Richard Barnett. Vote: Motion carried by unanimous roll call vote (summary: Yea = 5). Yea: Kevin Arrington, Bryan Burrows, Richard Barnett, Kathy Christensen, Connie Nielson.
PASSED and APPROVED this 25 day of June, 2019.