BOARD OF COMMISSIONERS
JOINT COUNTY/CITY ROAD FINANCE MEETING
November 25, 2003
Lane Community College, Bldg 19, Room 102
Commissioner Peter Sorenson presided with Commissioners Bill Dwyer, Bobby Green, Sr., Don Hampton and Anna Morrison present. County Administrator Bill Van Vactor and Recording Secretary Melissa Zimmer were also present.
Also Present: Alan Burns, Dave Braley, Tim Brooker, Jim Torrey, Anne Ballew, Betty Taylor, Gary Williams, Brian Huber, Lindsay Haskell, Diana Tonkin, Ollie Snowden, John Edwards, Rob Ward, Ron Petetti, Roberta McClintock, Jim Johnson, Richard Meyers, Mike Hudson, Bob Petersdorf, Jim Renshaw.
1. Convene Board of Commissioners' Meeting
Sorenson convened the meeting.
2. Welcome and Introductions
Morrison presented a check to the City of Junction City for $90,898.23.
Dwyer presented a check to the City of Springfield for $507,809.71.
Sorenson presented a check to the City of Eugene for $1,204,072.82.
Hampton presented a check to the City of Oakridge for $79,946.45; to the City of Creswell for $73,249.83 and to the City of Cottage Grove for $130,380.42.
3. Overview of Meeting Structure
Ollie Snowden, Public Works, recalled the Board asked him to gather data prior to this meeting He sent a letter to the public works directors for all of the road related revenues in FY 02/03. He summarized them by operations, maintenance and a list of representative activities and ending cash balance in the road fund.
4. Review Results of Revenue/Expense Reports
Snowden reviewed the results of the revenue and expense report on Attachment B. (Copy in file).
5. City Transportation Funding Needs
Richard Meyers, City of Cottage Grove, gave a presentation that he had given to the City Council of Cottage Grove in March 1993 when they were looking at a local fuel tax.
6. County Payments Re-Authorization
Sorenson thanked Senators Wyden and Smith. He noted that he and Green testified before Congress. He said Lane County receives more federal forest payment money than any other county in the United States. He noted that one-half of all the money goes to Oregon counties. He added that the law sunsets and is a short-term arrangement. He said they are working hard to get the legislation re-authorized.
7. Proposal for Redistribution of County OTIA III Funding. (Commissioner Sorenson, Attachment D)
Sorenson discussed Attachment D (copy in file), for the County’s portion of the OTIA III funding. He noted the total amount for reimbursement in 03/04 is $3.2 million. He noted that Attachment D was prepared by Public Works and was not reviewed by the Board of Commissioners. He said they were just presenting this information.
Dwyer requested to see a graph of all of the projects in Cottage Grove.
Sorenson wanted feedback on Attachment D and the methodology of blending the population of road mile numbers on the use of different levels of OTIA III revenue.
Jim Johnson, Creswell, stated he liked the average road miles and population calculation. He asked the Board of Commissioners to consider recognizing the five smallest cities. He said his situation is different than the larger cities.
Diana Tonkin, Mayor of Westfir, stated Westfir only has two city streets and a rest area. She wasn’t asking for more money.
Jim Torrey, Mayor of City of Eugene, commented that in terms of distributing the OTIA money, he said if the decision was what Jim Johnson recommended, he thought the best way to determine the future funding split would be to bring in two or three outside experts who are neutral to develop criteria. He said there is a difference between a mile of road between Coburg and Harrisburg and Willamette Street and Sixth and Seventh. He hoped they could find a way to deal with all of the maintenance problems. He said because no one wants gas taxes they would have to solve the problems themselves.
Dwyer commented that the cities can’t take 90% of the road money to put into new construction, that the money needed to be used for repairs.
Morrison’s concern is the discrepancies in the engineering costs. She asked how they could address the consistency.
Snowden thought they would have to hire an outside independent auditor. He noted that each jurisdiction does things a little different.
Betty Taylor, City of Eugene, hoped that everyone could work together instead of each city demanding something. She commented that everyone uses each other’s roads. She said they all have an investment in the roads. She hoped roads would be repaired before any new roads were put in. She wanted commitment to preserve what they have before they build anything. She was in favor of a car registration fee that they could do countywide
Sorenson thought the formula in the County’s portion of the revenue is that it gives the cities flexible funding to deal with maintenance. He thought there was a need to give the cities additional revenue. He thought they should use the money for maintenance by giving them the County’s portion of the new OTIA III revenue. He thought they should come up with a formula for the distribution of this money and if the County has additional revenue to share it with the cities. He asked if they needed to have an issuance of a direction to hire independent auditors. He wanted to use the registration fee for maintenance.
Rob Ward, Dunes City, commented they were talking about a minor difference for the smaller cities. He said any one of the programs would work for them. He said before they go to the voters to ask for more money, they need to know how much is needed. He asked what the needs really were. He wanted to find out before they spent any money in getting an auditor. He also wanted a countywide application for revenues so they would know what is needed.
9. Discussion of Long-term Strategies
a. Operating Efficiencies – Are there opportunities in considering partnerships, consolidation, or alternative service delivery?
Sorenson suggested exploring any operating efficiencies.
b. Local Option Fuel Tax (Attachment E)
Sorenson said this could be a potential yield for a Lane County local motor vehicle fuel tax with the tax levels ranging from one to five cents. He added they had it broken down on whether they should have it collected on gasoline and diesel and shared with the cities on a per capital basis or gasoline only shared with the cities on a per capita basis.
c. Local Option Registration Fee (Attachment F)
Sorenson explained they discussed a potential Lane County motor vehicle registration fee that has a yield based upon a fee level of $5, $15 and $54, where a percentage of the money is shared with the cities.
Snowden explained that in Attachment F, if they want the figures to represent annual figures, they have to divide the $54.00 column by two because the annual increase permitted under Oregon State law is $27 per year.
Green thought they needed partnerships around the transportation system because they all benefit from the system. He noted they receive no money from bicycles in helping with the construction of the roadway. He hoped they could take several different approaches to get what is reasonable. With regard to the OTIA money, he agreed with bringing in someone to examine what would be appropriate. He wanted to do that instead of adding a charter amendment to be voted on by the public. He said they could have a commitment for five years where the motor vehicle fee could be 100% committed to the cities. He said they have to establish what the priorities are. He hoped they could come up with scenarios to give to the CEO’s of the cities and get a consensus from the cities to see what could be done from a multi-approach versus the County needing more money. He thought the County could forego its share of the countywide gas tax to get a handle on some of the cities’ backlogs. He thought that should be the priority in handling the system.
Sorenson commented that in the future things might be different if the federal forest payment legislation is not re-authorized. He said the Board of Commissioners is guided by the reality of the existence of the money that is coming into the County now. He said in making the decision, they have to be aware of what their concerns would be.
Dwyer suggested using technology to resurface the roads where it is affordable. He said they could never find enough money to fund every road project.
Alan Burns, Mayor of Florence, commented they have to obtain money to deal with the backlog to bring the cities up to their standards. He said then they might have enough money coming in from federal and state programs that could maintain the situation. He agreed the rural areas should have a different formula, as long as there is enough money to solve the additional problem.
Green was interested in setting up partnerships. He wanted to consolidate efficiencies. He commented the public doesn’t care who repairs the roads as long as it is fixed. He said they need to focus on a set of solutions. He said they have to establish what the priorities are.
With regard to Attachment E, Johnson thought that the gas tax plus diesel would be a better use than just a car registration. He wanted to know how it would get distributed per capita. He wanted consideration for gallons that are pumped by jurisdictions. He thought they should factor in where the gas gallons are generated.
Morrison thought they should go to the voters with either the gas tax or the registration fee. She said when they go to the voters they have to be able to demonstrate beforehand that they had tried to work through some of the problems. She said if they could show the public what things are really like, it would be an easier sell for new taxes.
Taylor agreed that they need to look at ways to save money and be more efficient. She said they should have a vote of the people for whatever they do. She thought a registration fee was equitable because people who have two or three cars would pay two or three times. She said they need to make a commitment to put maintenance and preservation above new projects. She thought that way they could convince the voters to vote for a small registration fee.
Green suggested setting up a model like the Metro Wastewater Management Service District. He said if maintenance was a priority with everyone then they could speak in a unified voice and demonstrate they could get things done. He noted as leaders they need to give the direction on what the priorities should be.
Snowden commented that in 1997 the County and ODOT split the cost of a $38,000 audit that looked at consolidation as a way to save money. He noted the report said there were savings that were undefined. He said the difficulty they found in moving forward was the resistance to change.
Torrey commented they have a big backlog. He said his concern with the possibility of efficiencies is that some of them won’t be able to hit the target. He asked if they were precluded from raising funds within their own community without a gap. He thought they should take the OTIA money to be put towards operations and maintenance. He commented that there are times they would need to build new construction because there are changes in the community and population that require the new streets. He said they have a balanced need for preservation and maintenance.
Sorenson commented they would be doubling the payments with the County receiving the new OTIA III revenue and the County giving up its OTIA portion to the cities and having the 12 cities of Lane County dividing that money on a formula of average of miles and population. He thought it was a substantial effort on Lane County’s part to help the cities. He thought that was something that Lane County was able to do. He wanted the Board of Commissioners to have a work session to iron out some of the problems that had been identified, including the amount of money the County would put up under that, the tweaking of the formula so that the smaller cities that need the money get the money (and the smaller cities that don’t need the money don’t get additional money) and the formula to the larger cities is fair. With regard to efficiencies, he wanted to authorize County funds to look for those things and encourage the cities to also look at them. He didn’t sense that everyone wanted to work on the taxes and registration fees. He asked if they embarked on an efficiency or partnership study, how they would go about doing it.
Snowden stated they would have to define the scope of the study, for the sign shop or signal electricians. He said they could do that at a staff level. He said if they want something broader than that, then they would have to work with someone from the outside.
Morrison thought that partnerships were already taking place and asked for those examples.
Johnson said if Creswell had more money for road maintenance they could retain them but never build new roads. He said they would contract with the County to do the sealing of the road. He noted they have six people in Public Works who read meters and work with the wastewater system. He said working with the County would be a smart way of doing business.
Braley wanted to make sure the money the voters put in is sufficiently used. He said they have to start with good data to develop a program. He thought a car registration would be a tough sell and a gas tax would be more palatable. He added that tourists would also be paying the gas tax.
Dwyer stated he wouldn’t enact a gas tax without asking the voters first.
Sorenson commented on the distribution of the packet and the attachments A through F,
that there should be a Board work session on the topic of splitting the OTIA III revenue and a work session on how to respond to some of the suggestions. He asked the cities to take back the attachments A through F to their city councils for discussion and send a letter to the Board with their suggestions.
Mike Hudson, City of Coburg, concurred on many of the issues that were discussed. He noted they do contract with the County for services. He said a partnership they have is sweeping County roads that are heavily traveled. He said they have a heavy truck stop and the roads are torn up more than other cities. He thought consideration should be given to cities that have a lot of truck traffic.
Sorenson said the Board would have a work session to explore how to have operating efficiencies. He said one would be a sign shop issue and the other would be the electricians that are needed to maintain road traffic signals. He added he wanted to have a work session after they get the City of Eugene’s input after February 15. He said they will be discussing operating efficiencies and the share of the OTIA III money. He added depending upon the feedback they would also discuss the local option fuel tax and registration fee.
Gary Williams, Mayor, Cottage Grove, noted with the implementation of their three cent per gallon fuel tax, he only had one person complain about the tax.
11. Status of County General Fund
Van Vactor gave a report on what Lane County’s general fund budget faces. He stated the cities of Lane County use many of the services that are in jeopardy. He said that Lane County has a general fund of approximately $100 million and 50% of that is discretionary. He noted that of that amount, 70% of the discretionary amount is allocated to the Sheriff’s Office, Youth Services Department, the District Attorney and Health and Human Services.
Van Vactor discussed a graph of projections for the next few years (copy in file). He said the expenses are going up annually at about 6%, but the revenue only goes up about 3% per year so there is a widening gap. He said Lane County will have to do a combination of reductions and adding some revenue. He noted they cut $2.5 million last year. He said the jail lost 119 beds and they lost the resident deputy in Florence. He noted in the next few years Lane County faces additional cuts of $1.5 to $2 million each year. He said they discussed possibly making all the $8 million in cuts at once to give three or four years of stability. He added this summer they found out that Moody’s looked at Lane County’s financial condition and noticed the reserves were down significantly. He said that Moody’s put them on an 18-month watch and gave them a negative outlook. He said they have 18 months to come up with a strategy to rebuild the reserves.
Van Vactor explained the strategies they support include greater reduction to produce the stability they need as well as strategies around revenue. He said that Public Safety is Lane County’s highest priority and it gets a large percentage of Lane County’s budget. He added that when they face the reductions, they would not be exempt. He noted that the Sheriff was talking about closing additional beds and he has raised the issue of whether they would be able to maintain a patrol on a 24 hour a day, seven day a week basis. He said a possibility would be going to 20 hours of patrol a day.
Van Vactor said there would be a possible election on February 3 to repeal the income tax increase. He said if that happens the impacts to Lane County government could be significant. He said they don’t have any money to backfill the state cuts. He said there would be a potential for significant reduction in the jail and Senate Bill 1145 payments as well as Parole and Probation and Mental and Public Health.
With regard to revenue strategies, Van Vactor said they would be examining the revenue and having a citizen’s task force review how they could stabilize Lane County services.
Adjourned at 8:10 p.m.