HASSO HERING

A perspective from Oregon’s mid-Willamette Valley

Election may affect Albany ‘fee’ next year

Written September 23rd, 2020 by Hasso Hering

During its virtual session Monday, the council listens to Manager Peter Troedsson, bottom right, talk about plans to develop a monthly fee to augment city revenues.

Albany officials have the green light to prepare a city utility fee to help support the parks, libraries and police and fire departments. But whether or when the new fee starts depends on decisions yet to be made, either by the voters or by the council alone.

City Manager Peter Troedsson Monday got the council’s OK to start the development of a monthly fee to help close the growing gap between city expenses and income. “This preparation work is required before council considers implementing a utility but does not obligate the council to do so,” he wrote in a memo, “and it does not impact whether council implements the utility on its own authority or refers it to the voters.”

The fee would be added to the monthly billings for water, sewer and storm water disposal. Once a fee package is worked out, whether to impose it or refer it to voters will be up to the council in office from 2021 on.

Based on answers to questions I posed them, candidates running for mayor and council in the Nov. 3 election are divided on the issue.

In Ward 1, Keith Kolkow thinks “voters should have a say” on the utility fee, and Matilda Novak wants to “let the public decide.” But Sean Knowles says that if a utility fee proves necessary, it “should be decided by the council.”

In Ward 2, Ray Kopczynski says he definitely supports the council imposing a utility fee, while Amanda Dant provided an 11-line reply that doesn’t say which way she’s leaning. “I think the council and community will need to work together to find new ways to bring funds into the city and consider imposing new/raised fees,” she wrote.

In Ward 3, there’s a clear division on that question. “Councilors are elected to make such decisions,” wrote Marilyn Smith. But Jessi Brenneman said, “I do believe the utility ‘fee’ should go to the voters.”

Mayor Sharon Konopa, running for re-election, has often said she wants the council to enact a utility fee. And Councilman Alex Johnson II, running against her, has maintained the decision should go to the voters. Both more or less reiterated those positions in their replies. (See the mayor’s comment below.)

If Johnson becomes mayor, someone new will be appointed to the council.

So, while a utility fee is almost certain to be proposed in 2021, the outcome on Nov. 3, 2020, will likely determine if the council or the voters decide whether it becomes law. (hh)

And by the way: “Utility fee” is a truly misleading term, but it’s in common use. In no way is paying for parks or the police anything like paying a utility bill, and the “fee” is really a tax. But Oregon courts have found that constitutional limits on property taxes don’t apply to these fees.



15 responses to “Election may affect Albany ‘fee’ next year”

  1. Bill Kapaun says:

    It’s a sales tax no matter how they want to dress it up.

    One wonders how many hidden fees are already hidden in those bills considering the veracity of the current council and 1 ex member that is running again.

    • Hasso Hering says:

      It’s obviously not a sales tax because it has nothing to do with selling or buying anything.

      • Steven Reynolds says:

        Have to disagree HH, it’s the only commodity the city is selling… water. There’s no difference than selling bottled water, in fact there was one response that said they figured they were paying close to .08 a gallon with the current rates and they felt it should be hand delivered for that price. I’m going to think about this for a couple days and then reply, think through the issue.

  2. Rolland says:

    So let’s be honest, call it what it is, a TAX since it doesn’t have a thing to do with our Utilities.

    Over $2 million was just spent to study the water front. That money and what CARA wants to hold onto is money that could be used to help offset the $11 million shortfall the City is about to face.

    • Keith Kolkow says:

      Hi Rolland, I can understand why moving funds from the CARA budget to offset the budget shortfall would seem like an easy solution, however that isn’t possible. The City budget and many of its funds can only be used for their intended purpose. Unlike a personal budget where you could move say $100 from your budget for yard maintenance to cover your $100 electric bill the government budgets do not function in the same way. CARA funding has specific purpose and that funding cannot be moved elsewhere – frustrating as it may seem it keeps our government spending accountable and less corrupt. I hope this helps you, there is also more documentation on the city website.

      • Gordon L. Shadle says:

        Keith, if you want to be on the council, you need to better educate yourself on CARA and TIF.

        Every property taxpayer can see the levied tax rate for CARA. It is identified on every taxpayer’s property tax statement.

        The city council has the power to under levy CARA’s maximum increment. It simply takes political will.

        The result will be an influx of tax revenue to every local taxing district, including the city’s General Fund.

        In Albany’s case, an under levy can avoid CARA’s billing the General Fund of about $1.5/million per year.

        Are you up to the challenge?

        • Keith says:

          Hi Gordon, wouldn’t under levying CARA would be a short sided? The objective of the ARA is to improve tax lots that are currently under a tax freeze. Then the increased tax revenue comes in after the ARA is closed. ARAs are long game and getting anxious and ending them prematurely to try and fix budget problems that haven’t been addressed by the current council defeats the entire purpose. Additionally, the CARA projects create jobs and additional investment to the district increasing economic activity. I’m sure Hasso will be posting his CARA question soon so we can discuss more after that comes out. Yes, I’m up for the challenge. I’m the only candidate in Ward 1 answering these questions and then engaging with people, I’m happy to hear different perspectives to inform decision making. Do you have any other ideas for fixing the deficit?

      • Leroy says:

        Shut CARA down. Then the energies spent scrambling to cross the T’s and dot the I’s to what ever venue is to be served by CARA can relax back under their rocks. And more screutiny can be put to better decisions. Albany should sell the Merry go round to a Ringling brother type, one of the brothers had a famous quote. Since the Teachers can work from home, sell the schools, you know the ones that were in such terrible shape for children but worked out perfectly for the over paid administrators. Then you won’t need to worry about how compounded stupid decisions are eating up resources. Funny isn’t it, how police and fire are always on the chopping block, I find that practice sickening.

  3. Keith says:

    Here’s my answer in its entirety.
    We should be considering both budget cuts and revenue increases to help close the budget gap. I am not in favor of the council imposing fees that are regressive and that disproportionately affect lower income and middle income households, but both cuts and revenue should be on the table. Voters should also have a say when the city is asking for more revenue. This is one of the many reasons I would like to host town halls and public forums during accessible times for everyone when these issues come up so we can explain why the need is there and exactly how much it would cost.
    Keith

    • Scott Bruslind says:

      Thank you Keith. An example of good governance.
      “host town halls and public forums during accessible times for everyone when these issues come up so we can explain why the need is there and exactly how much it would cost.”

      Whatever the mechanism (plebiscite/Council fiat), the action should be transparent with opportunity for engagement.

  4. Hasso Hering says:

    Mayor Konopa sent me an email saying this was her complete answer to the utility fee question:

    “I will remind folks again, property taxes do not even fully fund police and fire services. Keeping that in mind, we either keep reducing services and programs or seek new revenue sources. I think a fee for parks and libraries can be established by delaying infrastructure pipe replacement projects for two years and that annual utility increase amount would be used for assisting the needed programs. After that, when the economy improves, we can look at the level of funding needed.
    “A big nationwide political push is for defunding or reduce funding for the police and that move would go against the will of Albany voters who supported, with a large margin, our police and fire levy. To reduce levy funding is a question that would need to go back to the voters if decision makers push to defund the police. I strongly oppose that route. Crime is rising and if we lower our level of service, crime will just increase more.”

    • Gordon L. Shadle says:

      Notice the Mayor’s sleight of hand –

      “….property taxes do not even fully fund police and fire services.”

      Property taxes (including the safety levy) account for less than 50% of the revenue flowing into the city’s discretionary General Fund.

      There are many other sources of revenue she fails to mention. And discretionary spending requires setting priorities.

      But when every service is deemed “essential” nothing is discretionary. The demand for more revenue is insatiable.

      And calling for the imposition of a “fee” to pour into the trough is further evidence of her failure of leadership.

      Albany residents deserve better.

    • sonamata says:

      I voted in favor of the fire & police levy because we couldn’t vote for fire and police separately. People conflate levy success with police support, speculating it’s too unpopular to discuss police service effectiveness vs their relatively large budget (~$17.5M annually, ~$320 per resident). I voted for the levy, and I strongly believe city council has a fiduciary duty to the public to have these hard conversations. It’s absurd to spend effort nitpicking Carnegie library usage data when their budget is <2% of the police budget.

  5. Richard Smith says:

    In my house, when things get tight, you tighten up, and maybe go without something until you can afford it.

    Perhaps it is time for the city to use the same common sense! …wait, this is Albany!

  6. Steven Reynolds says:

    These are some of my responses to one of many discussions my friend, Ray K (Kopczynski), and I were having about some possibilities for affordable housing and where we are when we come out the other end. No matter what, revenue increases, service decreases, it’s going to be a tough road.

    My responses to Ray…

    I don’t know Ray… staff is sending out 407 pages of agenda from just the last council meeting with hundreds of pages of code and you want what comes down to something that is comparable to a FEMA trailer after Hurricane Katrina, these are two entirely different worlds, doesn’t resemble anything the city is promoting.

    I’m going through code right now, highly complex. It’s nothing like when people just built a home.

    ———

    Why is the city spending huge amounts of capital redoing code changes when the state is doing the same thing? The state implemented HB 2001, let them do the work.

    You gave me the book, S.T. (Strong Towns), it’s all in there. For all intents and purposes as a community, we are bankrupt or to be more accurate in a situation that needs to be reorganized and I know you’ll argue with me but we are bankrupt, it’s just the body is still warm. We fall into that typical scenario of a company with multiple layers of management with redundant functionality, city doing the same work as the state, city doing the same work as the county, county doing the same work as the state, schools with massive debt and expenses. We have huge amounts of leverage and massive pension obligations with unrealistic promises of returns. Add in the fact we’re down at least 40% in economic activity and we’re like every company out there that’s filing right now. You almost have to let things collapse before you can reorganize because there’s no appetite for doing what’s necessary to get back into balance.

    I live this everyday I see both sides, I can’t tell you how bad Salem has damaged the rental housing market with the uncertainty they have caused. Affordable housing is not even on the radar any longer now it’s just keeping what housing we have left and trying to cover expenses until something magical happens or there’s a Hail Mary vaccine that proves effective. I was in Lowes the other day, I was paying $6 for a 2x6x10 just a month ago which was up almost $2 dollars from year before that, now they’re over $10, that’s called the beginnings of hyper inflation. It’s put most projects out of my reach at this point.

    I’m open to something you see that I don’t, if you can point out how this community is going to cover expenses and still thrive.

    ——-

    We’re still in the middle of the hurricane, we have so much uncertainty right now everyone is pretty much paralyzed. Until the state returns things back to normal it’s going to get much worse. We have no idea what the moratoriums look like, are we like New York where 90% of the restaurants can’t pay rent or are we much better off? What’s our water and sewer delinquency numbers look like? If ever there was a time for the city to be transparent, now is the time. It’s easy to be transparent when things are good but when everything goes south that’s not the time to start having executive sessions and behind the scene operations.

    Obviously we are getting indicators like commodity prices but we don’t know how bad it’s going to get, we’re being forced to plan for the worse case scenario (just like they did during the G.D.) (Great Depression). First thing that needs to happen is the courts need to open back up, individual conflicts should be in front of a judge not these broad stroke measures that just nuke everything and are just reactionary. Let people work out their issues.

    At first Council is just going to go along for the ride they’re not going to be able to do a whole lot. It will be the standard approve staff recommendation and business as usual until they’re forced to confront the problem, which may be a couple years down the road like it was in 08/09. A lot of consolidation and reorganization, palatable is the least of what this is going to be.

    There’s going to be economic opportunity, it’s just we have to realize our economy is a lot like the forest fires, every so often the fires come through and clear out everything in a devastating way short term, but new growth occurs and a new beginning.

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