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Utility tax workshop results in status quo
9/26/2013 11:21:08 AM

By Craig Howard
Splash Contributor 

After squeaking by as a quorum, the Liberty Lake City Council emerged with the status quo at a utility tax workshop on Sept. 10. 

While not signifying the final word on the tax in the 2014 budget, the discussion over the toll on cable, phone, electric, gas and garbage bills did not muster enough debate to shuffle the standing 3-percent rate that has stood since the beginning of 2012. Still, residents should stay tuned, according to Council Member Dan Dunne.  

"Will there be a change? The budget discussions will reveal that," said Dunne following the workshop instigated by Council Member Keith Kopelson at the council meeting on Aug. 20. 

In addition to light attendance in the chambers at City Hall, the dais also featured its share of empty seats on Sept. 10 with Council Members Josh Beckett, Cris Kaminskas and Shane Brickner missing the workshop with excused absences. Beckett and Kaminskas have been among the most outspoken opponents of the tax, both advocating for its removal on the grounds that it was installed as a temporary revenue source at a time when the city was facing budget challenges.  

"It's difficult to say what they would have supported tonight," said City Administrator Katy Allen when asked how the conversation would have been different with a full quorum.  

Finance Director R.J. Stevenson did provide an overview of various alternatives to the 3-percent scenario, each resulting at or near the amount of $662,000 projected as the overall revenue from the tax in 2013. At the council retreat on Aug. 11, a majority of the governing board approved the amount remaining at $662,000 for 2014. All funds from the utility tax are currently designated for the city's street maintenance program. 

"We want to identify different ways to get to that $662,000," said Allen. 

One option would reduce the rate on gas to 2 percent and increase the phone rate to 3.5 percent, generating $663,000 for 2014. A second version lowers the gas to 1 percent while transitioning cable and waste management to 4 percent and 5 percent, respectively. A third scenario would involve zeroing out the gas rate and moving cable to 5 percent and waste management to 6 percent. 

In the Books, 
On the Docket
A look back and ahead
at business conducted 
by the LL City Council
Compiled by Craig Howard
Splash Contributor
Council approved an interlocal agreement with Spokane County regarding Spokane Valley/Rathdrum Prairie Aquifer protection funds. The new format means the city will receive two-thirds of the funds generated each year through a $15 fee per household, with the remaining third going to the county. The first read of Ordinance No. 208 - establishing a municipal Aquifer Protection Fund - also occurred Sept. 17. The city will receive roughly $90,000 annually to address aquifer protection efforts within Liberty Lake limits.

A pair of ribbon cuttings took place in the city on Sept. 21, starting with an informal event at the corner of Sprague and Molter to acknowledge the completion of the Sprague Avenue Trail. The first installment of the Fallen Heroes Circuit Course was at the center of a ceremony later that day in Rocky Hill Park. Representatives of the armed forces, the West Valley High School marching band, city dignitaries and Spokane County Commissioner Shelly O'Quinn were on hand. 

City Administrator Katy Allen said there were no plans to unearth the utility tax discussion after council reached a consensus to stand pat on the 3-percent rate at a workshop on Sept. 10. The conversation regarding any tax shift would not occur, Allen said, "unless the council as a majority wants to bring it back." Meanwhile, city staff will continue to monitor potential increases to Avista rates for gas and electricity going into 2014. 

Council approved $7,500 for Project Access, a local program that provides basic medical care for low-income residents.

Allen said bids will open for the first phase of the Liberty Lake Ball Fields on Sept. 26 with the project expected to be awarded on Oct. 1.

Finance Director R.J. Stevenson informed City Council that Mayor Steve Peterson's official budget will be ready for council review by its Oct. 15 meeting. Council agreed to convene for a budget workshop on Oct. 29, while "Mayor Budget Questions," featuring inquiries and ideas from the City Council on Peterson's financial game plan, will be part of the budget process again this year following a successful premier in 2012.  

On Oct. 1, council will hear the second reading of an ordinance to approve 14 amendments to the city's development code as recommended by the planning commission. The meeting agenda will also include a public hearing on the ordinance.   

The Liberty Lake Salary Commission is expected to present its recommendation regarding compensation of the mayor and City Council at the Oct. 1 council meeting. 

City Council is scheduled to meet Oct. 1 and Oct. 15 as part of its regular schedule and then again Oct. 29 for the budget workshop. The 7 p.m. meetings will be held at Liberty Lake City Hall, 22710 E. Country Vista Drive.
As part of evaluating a potential shift to the utility tax terrain, Stevenson said the city has been talking with representatives from Avista about projected growth and any possible rate increases on its end. He added that a mild winter and a drop in Avista gas rates have essentially balanced out any revenue increase based on the growth of the city.  

The final two options would drop the rates paid for both gas and electricity - a move championed by the local business community. The first would put margins for both power sources at 2 percent while hiking cable and phone to 4 and 5 percent, respectively. The final format would zero out gas and drop electricity to 1.5 percent while placing cable and phone at 6 percent and waste management at 4 percent.

"The last option makes a lot of sense from a business standpoint," said Theron Rust, real estate manager for Liberty-Lake based Huntwood Industries who addressed council on Sept. 10. "Staying in business is still a challenge for anyone. We're just trying to keep everything going, support our employees and pay our taxes."

Rust, who acknowledged that city leaders "do not face an easy task" in the utility tax debate, said Huntwood accounts for over 6 percent of the entire amount paid to the city annually through the utility tax, or just under $40,000. 

Kopelson expressed concern that the options which significantly lower power rates would unfairly favor businesses while adversely affecting the average citizen.

"It seems to me that the majority of residents who object to the utility tax are from big business," Kopelson said. "With some of these options, it looks like we're shifting most of the burden to the citizens. I lean toward leaving it at 3 percent across the board."

As far as any potential change to the rate structure, Stevenson pointed out that the timing of any council decision would be important to have the new fees effective by Jan. 1, 2014. The city must provide a 60-day notice to utilities before the altered rates take effect.

Dunne voiced support for the option that would drop gas to 1 percent while moving waste management to 4 percent and cable to 5 percent. He said the phone rate should remain the same because "call centers are a big part of the city's commerce." 

Council Member Lori Olander, who hosted her own utility tax workshop in July, expressed hope at the meeting that council might still address the possibility of lowering the tax altogether. Allen said the governing board would have an opportunity to adjust the revenue baseline during budget talks. 

"If you don't want the $662,000, you can address it in the budget process," Allen said. "That's when you'll be voting on a specific number."

Town Square Park pitch shared with council Sept. 17
For Liberty Lake City Administrator Katy Allen, it was hip to be square at the Sept. 17 City Council meeting. 

Addressing one of the three top priorities established by the governing board at its summer retreat, Allen shed light on the past, present and future of the 6.4 acres owned by the city along Meadowwood Lane that have been discussed as the site of a town square and civic center for more than a decade. 

Council members voted in July to prioritize a strategy for the property going into 2014. 

Allen told council she spent the past month researching the history of the plot in hopes of providing "an historical perspective on the 6.4 acres that is factual and objective." 

"I just wanted to get the facts straights on the story," Allen said.

Allen's anthology began in 2003, when the city adopted its comprehensive plan which included mention of "a public presence in the central business district." Allen cited regional examples of similar themes, such as McEuen Park in Coeur d'Alene and Riverfront Park in downtown Spokane. 

In 2005, the city purchased the 6.4 acres for a pricetag of $1.75 million. The debt, Allen noted, will be paid off in 2020. 

Following the land acquisition, Allen described "the rigorous process" the city went through to develop a design strategy. The architectural firm of Bernardo Wills was eventually selected to devise a vision for the property . While bids came in high for the town square portion of the project, plans moved forward on an ambitious community center/library development which carried a cost of around $10 million.

By April 2008, the project found its way to the ballot only to have voters resoundingly reject the $9.8 million proposal by a count of 961 to 598. 

Looking back, Allen said the failure of the capital facilities bond could be attributed to a variety of factors, from the shaky economy to a fire district initiative being on the same ballot to the community simply not being supportive of such a large-scale expenditure. Whatever the reason, Allen said the land "went into holding mode" after the 2008 vote.

The city moved ahead later in 2008 with the purchase of a former industrial building that would eventually house the municipal library and the police department. While the 6.4 acres gathered cobwebs, Allen said citizens continued to express support for open space, trails, fields and a public presence in the central part of town.

Last March, the city hosted an open house to discuss design options for the 6.4 acres. The first phase of the Town Square Park development - featuring trails, parking and an amphitheater - was estimated at nearly $850,000, though failure to secure a state grant earlier this year set the project back yet again.  

"Now it's 2013, and we're still asking what to do with this property," Allen said. 

While applauding the level of citizen feedback on the 6.4 acres over the years, Allen pointed out that a better strategy might be for the city "to put together a vision, then ask informed questions."

"I'd like to shape something, then ask relevant, real-time questions that are relevant to what a municipality can do," Allen said.

Allen concluded her presentation by expressing hope that the city could "take the town square project, put some context to it and bring it back for discussion as part of the 2014 budget." City staff has had discussions with the Spokane Transit Authority - which operates a park-and-ride lot adjacent to the grounds - about collaborating on the parking portion of the project. 

"I'd like to see if there's a way the Town Square Park can be built with other entities without going into debt and not necessarily having to decide on the rest of the property," Allen said.