Crested Butte Council delving into 2012 budget

Talking mill levy, reserves, solar panels and bathrooms

It is the start of budget season among local governments and no local budget is looking flush. In Crested Butte, the mill levy will likely be adjusted up to compensate for declining property valuations. The goal of the council is to simply bring in the same amount of revenue from the tax as in 2010. The town will also dip into reserve fund balances to make the 2012 budget work.
The Crested Butte council, town department heads and all the potential candidates in the upcoming council election attended a budget work session on Monday, September 12. Led by Finance Director Lois Rozman, the session was as much educational in an historical sense as was it was about dollars and cents.

“Because the fall election is November 1 this year, the budget preparation period is a bit compressed this year,” Rozman told the participants. “That’s why we start now and give all the candidates all the information since some of them will be working with this budget even though the current council will debate and approve it.”
Traditionally a conservative budget architect, Rozman proposed a budget that tapped the general fund reserves for $170,000 and the general capital fund for $202,000. “I’m not having a heart attack with that number. I’m okay with this,” she said. “I don’t want to do it on a long term basis but we’ve built these balances over the years to get the town through these types of lean times.”
In that vein, Rozman’s proposed budget calls for a 2012 budget that is expecting an increase in town sales tax of 1.5 percent. “July this year set an all-time record so we are budgeting that as flat but it is a busy month. That’s the general fund. I admit that I am a little worried about the capital fund.”
The capital fund, which includes much of the Parks and Recreation Department, is funded primarily through Real Estate Transfer Tax. The RETT has been slim the last few years as homes sales took a nosedive during the recent recession.

Mill levy adjustment coming
“I think we need to adjust the mill levies to bring in the same amount of revenues we have been collecting,” explained Rozman. “Because the property valuations have declined about 20 percent, I think the council needs to approve an increase in the town levies.”
Rozman said the town has complied with the Colorado Taxpayer Bill of Rights (TABOR) and left a lot of wiggle room with the town mill levy. While it could go to 16 mills for the Street and Alley Fund and up to 7.3 total mills for the Town General Fund, Rozman is proposing raising the General Fund mill levy to about 2.5 mills from 2 mills and the Street and Alley Fund mill levy to 8 mills from 6.4.
Mayor Leah Williams pointed out that because of state law, commercial property would be hardest hit by any mill levy increase.
“I’m comfortable adjusting the mill levy to sustain where we are,” said councilperson Jim Schmidt.
“I hear from second homeowners, how cheap our taxes are,” added councilperson John Wirsing.
Still, Wirsing suggested raising the levy over two years to give a break to property owners. He suggested putting off some proposed street paving to make the numbers work.
“If this is work you want to accomplish, you should just do it,” said Parker.
“It is reasonable to get the same amount of money coming in,” said Schmidt. “We’ve always been up front and fair with the people and I think this is fair. We didn’t raise the mill levy when the values were rising. This is not bringing in more money.”
The proposed budget includes a 2 percent increase in wages for town staff. Those salaries have been frozen for the last two years. About 70 percent of the General Fund goes to salaries and benefits, or close to $2 million. There is also a 5 percent increase in the cost of health insurance budgeted for the staff.
“We will have to adjust the specific insurance number when we see what it is in July,” Rozman said.
“We may need to make some tough decisions with the employee benefits,” added Town Manager Susan Parker. “We can’t be sure yet what adjustments will be needed.”
Capital purchases continue to be deferred. Trucks, patrol cars, Zambonis will be put off again. “The duct tape budget is getting pretty steep,” quipped Parker, “but we’ll make do.”

Solar thoughts
Councilmembers Schmidt and Reed Betz argued for more alternative energy expenditures. “I’ve been talking to the GCEA [Gunnison County Electric Association] about the potential for solar energy,” said Schmidt. “While there is a 20- to 25-year payoff when buying solar panels, it may be worth it for the town. Maybe there could be a solar farm down by Gunnison where it is sunnier. It seems a reasonable thing to pursue.”
“Initial infrastructure cost is the key,” responded Parker. “We are watching for state and national grant opportunities but some other equipment purchases are higher priorities in general for the town right now.”
Parks and Recreation Director Jake Jones said all the town employees are looking at affordable sustainable measures. He cited looking at how to water the ball fields with untreated water and using electric vehicles in town. “We never take our eyes off that stuff,” he said, “but we do keep moving it back year to year.”

Street cred
In the Street and Alley Department the plan is to do some paving next summer. Elk Avenue, Whiterock, Belleview and Seventh are all slated for some fresh blacktop. “We used to do major street projects every three to five years and it’s been at least five years now,” said Gillie. “We need to keep up maintenance to maintain the integrity of the streets.
Public Works Director Rodney Due budgeted in two full-time seasonal employees to work on winter street maintenance. The town doesn’t want a repeat of the debacle that occurred last March when a big street snowpack started rapidly melting closing streets for days. The two employees would cost the town about $30,000. Due said they figured the additional costs of the March madness was about $39,500 for six days. “We’ll keep the bus route completely clear this winter and the other streets will have a two- to three-inch snowpack. With the additional staff, we can absolutely do this,” he said.
“I think we need to do it so it doesn’t happen again,” said councilperson Roland Mason.
“We are learning from our mistake and doing something better as a result,” added Wirsing.
An official town snow plan is given a review each November.

From Smartphones to franchise fees to bathrooms
Other discussion items include when and if to rehire a community service officer for the Marshal’s Department. That position would deal with issues like dog violations, parking tickets and the like.
The staff is pushing the idea of having the council approve allowing the citizens to vote in the fall of 2012 for a mill levy dedicated to parks and recreation. It would be a stable source of income for the popular department instead of relying on the RETT.
Has the time come for the town to buy the town manager a Smartphone? Perhaps, and that will be a topic of further budget discussion. Councilperson Reed Betz is keen on all the department heads upgrading to the current century of telecommunication technology.
Williams suggested the newly elected council revisit the idea of imposing a franchise fee on the gas provider in town, Atmos Energy. The current council refused to sign an agreement with the franchise and it is estimated the town lost about $33,000 in revenue this past year as a result.
Councilperson Roland Mason suggested a priority should be the upgrading of the bathrooms in the Town Hall, which is the former Crested Butte School. “They are pretty bad and we get a lot of traffic in here. “And frankly those bathrooms are exactly the same as they were when I went to elementary school here.”
The full council and staff will hold another budget work session on Monday, September 26 at 6 p.m. Everyone is invited.