Published: August 18, 2008 12:31 pm            

Keene City Council votes on water and tax rates

Land sale bid accepted

KEENE — The Keene City Council, in preliminary votes, approved water and tax rates for the next fiscal year, which begins Oct. 1. The votes are preliminary because the council still has to vote on the water and sewer rates, which will be presented to them in the form of an ordinance at a future council meeting.

The council also has to hold two public hearings on the tax rate — scheduled for 7 p.m. Aug. 28 and Oct. 11 at city hall — before formally voting to accept the rate.

Base rates for residential water customers will increase 67 percent from $15 to $25 for the first 1,000 gallons. The price of each additional 1,000 gallons consumed, up to 20,000 gallons, will increase from $6.30 to $8.70. The cost per 1,000 gallons above 20,000 up to 75,000 will increase from $6.30 to $9.20 per 1,000 gallons. Those using more than 75,000 gallons monthly will see an increase from $6,30 to $10.20 for each 1,000 gallon unit above 75,000. Base rates for customers outside city limits will increase from $22.43 to $37.50. Commercial base rates will also increase with the increase amount to be determined by the size of the commercial customer’s meter.

Sewer rates will increase 5 percent with the base rate, which includes the first 1,000 gallons, rising from $32.25 to $33.86. The rate for each additional 1,000 gallon unit will increase from $1.21 to $1.27.

Rising costs for Brazos River Authority water, which supplies part of Keene’s water needs, partially necessitated the cost increase. Diminished capacity from city water wells this year forced the city to purchase additional BRA water, council members said. The city also sold water at a loss in recent years, leading to a deficit.

Council members voted for a property tax rate of 82.1737 cents per $100 of value, which is the same as the current year’s rate. The city was able to maintain the same rate even though the city experienced a deficit because of increased property values, said Bill Guinn, city accountant. The city also had to pay a loan on money borrowed this year to cover a previous deficit, something it won’t have to do this year, he said.

Council members had two budgets and tax rates to choose from. The second had a rate of 75.7861 cents per $100 of value, which equals the city’s rollback rate. The rollback rate gives the city about the same amount of tax revenue it spent the previous year for daily operations plus an 8 percent increase for those operations.

The rate council members approved is above the rollback rate and means residents could petition for a rollback election once an official vote on the rate is taken. If successful, such an election would force the council to roll the rate back to 75.7861 cents per $100.

The rollback-rate budget was a stripped bare budget, Mayor Roy Robinson said, with no funding for extra needs. The rate approved by the council includes about $123,000 extra.

Fire and police calls have significantly increased in recent years and both departments are understaffed, Robinson said.

“We’ve been going without enough staff to meet the city’s needs in those departments,” Robinson said. “We’re a growing city and we need to meet those needs. This could possibly pay for one fire and one police employee. Which is not enough to meet our staff needs, but it’s a start.”

The council agreed to sell a tract of land to Southwestern Adventist University for $258,000. SWAU swapped the land with the city last year in return for the parcel of land Keene’s city hall presently occupies. Original plans called for the city to build a new city hall on the former SWAU land.

“That was then, this in now,” Robinson said. “I would rather smash my thumb with a big hammer than do this, but that’s the reality of our financial situation.”

SWAU had a right of first refusal on buying the land back. They were also the only entity to bid on the land in an auction.

The council once again voted to place another parcel of city-owned land, about 3.02 acres, up for auction. The land, located on Old Betsy Road, received no bids in two previous auctions. The first listed a minimum price of $140,000. The minimum for the second auction was $120,000, which will be the minimum price for the third auction.

Revenues from the sales will go toward paying budget deficits.

“It’s a sad day when we have to accept a bid for a piece of property we own and put another piece up for bid,” Councilman James Coleman said. “We need to look toward the long term. Otherwise, what happens next time when we don’t have property to sell?”

Wayne Tomblinson, president of the Keene 4A Economic Development Corp., resigned his position effective immediately. Tomblinson announced his intentions during the meeting’s open forum section.

“There are some of the city councilmen who are unhappy with the work the 4A board has done this year, and want to micro-manage the work of the 4A board,” Tomblinson said. “As president of the 4A board, the buck stops here. It is time for me to step out and let someone else be appointed to replace me. I am submitting my resignation effective tonight.”

Coleman, Tomblinson said, expressed a desire to abolish the 4A half cent sales tax and reduce the 4B sales tax from one half to one fourth of a cent. 4A and 4B taxes are voter-approved taxes, added to sales tax, which go toward economic development and quality of life projects.

Tomblinson listed numerous projects the 4A board accomplished such as the purchase of 23 acres in the southeast part of Keene for an industrial park.

Coleman, after the meeting, said changes in the law now allow 4B funds to be used for many things previously restricted to 4A funds. The half-cent tax could better be used for other things such as a street-repair fund or public-safety tax to benefit city police and fire departments. Either tax would also require voter approval, Coleman said.

Coleman said he discussed considering the percentage of the 4B tax but did not favor decreasing it.

        

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