The DuPont City Council, fresh from the defeat of a proposed property tax hike, raised other taxes and fees to balance its 2013 budget Tuesday.
Last month’s voter rejection of the city’s tax measure threw into disarray budget deliberations for leaders of the south Pierce County. The measure would have increased property taxes to make the debt payment on DuPont’s civic center and to keep three firefighters on the job after a grant expires next year.
The City Council adopted Mayor Michael Grayum’s proposals to raise revenue to make the debt payment and cover increased city costs, but there was no budget move to spare the jobs of the three firefighters.
The council did save the jobs of a police officer and a fourth firefighter – positions Grayum had put on the chopping block – by taking steps to create a new car tab fee and make other accounting changes. It also preserved the city museum, which Grayum had also targeted, keeping it open on a part-time basis with the DuPont Historical Society reimbursing the cost to staff it.
Councilman John Ehrenreich said it wasn’t a “pretty budget” but it did its job.
“Even with the failure of the levy, we are able to pay our bills,” he said.
Councilwoman Penny Coffey said this budget was probably toughest to reconcile during her decade on the council.
“We are kicking the can down the road,” she said. “We are focusing on our public safety, but yet the funding is not there for long-term sustainability. We will be revisiting these issues again next year.”
The council voted to increase its stormwater and water utility taxes; create a new business license for rental properties and new fee for temporary sign permits; and raise the cost to license a business in DuPont.
It approved a new business and occupation tax of five cents per square foot every three months, although the city will deduct the existing tax so businesses will have to pay only the new square footage tax if it exceeds the existing tax on gross business income. The council indicated it would revisit the new tax next year. Intel, one of the city’s largest employers, has raised concerns about it.
The council went a step further than Grayum had proposed by positioning the city to add a $20 fee that city residents will have to pay when they renew their license tabs each year. The creation of the transportation benefit district and accompanying fee will free up money in the budget now dedicated to maintaining streets.
The council approved the fee on first reading Tuesday and will vote on final adoption in January. The city couldn’t start collecting the fee until mid-2013.
The city had relied on real estate excise tax to help repay the debt issued to build the civic center, which includes city hall and the police and fire stations. That tax source dried up after the collapse in the housing market, and the city had to look elsewhere for the money. It has borrowed from other city funds to help make the debt payment. The council decided Tuesday to stretch out the repayment of those loans to help it regain its footing.
The council has budgeted $130,000 in expected real estate excise tax revenue from the sale of property that will pave the way for a distribution center that will feature two 790,000-square-foot warehouses. Two unnamed sources told The News Tribune last week that the tenant would be Amazon. City officials have not identified the tenant, saying it would be premature until a deal is finalized.
That windfall alone isn’t enough to help the city make its approximately $1.3 million annual debt payment on the civic center.
Christian Hill: 253-274-7390christian.hill@thenewstribune.com
@TNTchill
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