Iola sets budget for 2018



August 15, 2017 - 12:00 AM

Iola City Council members approved a 2018 budget that will increase property taxes by 8 percent at their meeting Tuesday night.
The additional 3.581 mills will mean the owner of a $100,000 home would pay an additional $41.45 on their annual property taxes. The current levy is 44.898 mills.
The additional funds will go into the general fund, which includes industrial funds and those that support the Bowlus Fine Arts Center and Iola Public Library.
This year, the city expects to be about $100,000 in the hole, according to Sid Fleming, city administrator.
For 2018, city officials have whittled expenditures in the general fund by $200,000, “but if we don’t do this increase we’ll still have a $68,000 shortfall,” Fleming said.
“We either must cut services and personnel, or raise money,” he told council members. About 75 percent of expenditures in the general fund go to paying wages and salaries, Fleming said.
All but Beverly Franklin approved the proposed budget.
“I hate to raise taxes,” Franklin said.
Councilman Bob Shaughnessy was absent.
As administrator it was also Fleming’s responsibility to steel council members of the need to raise water and electric rates.
A fiscal conservative, Fleming said to balance the electric fund, rates need to be raised 6 to 7 percent, “to get solvent,” and about double that to get water revenues where they need to be.
With only 3,300 households tapped into the city’s utilities, the burden is heavy, said councilman Aaron Franklin.
“I have people who say an increase in taxes will mean they can’t have cable TV or can’t run their air conditioning,” he said. “For some, it means they can’t afford their medicine.”
Councilman Jon Wells reluctantly accepted the reality.
“I know we still have to tackle these electric and water rates in the next several months,” he said. “And the longer we delay a rate increase, the less beneficial it becomes.”
Always the bearer of bad news when it comes to budgets, Fleming told council members, “Just because I have proposed it, doesn’t mean I like it.”
For Fleming, however, a rate increase means a chance to balance a budget.
“And that’s not even addressing the need to build reserves,” he said.
The electric fund ideally needs to have $3 million in reserves and a $500,000 buffer in order to afford equipment down the line and to weather a catastrophic storm.
“A town’s electric supply is more susceptible to damage than water or gas lines, which are underground,” Fleming said, reminding council members of the intensive damage incurred by the 1986 inland hurricane.
Reserve funds for gas and sewer in the amount of $250,000 apiece have been met, he said.
As for water, the annual $1.85 million in sales are reduced by about $676,000 each year in debt service to the water treatment plant west of town.
“There’s light at the end of the tunnel, though,” Fleming said, noting the city has less than eight years to go before the $5.6 million in remaining bonds are paid.
Raising rates by 15 percent would bring in an additional $288,000 a year, he said.
City clerk Roxanne Hutton responded to Beverly Franklin’s query about refinancing the loan on the water treatment plant by saying the city has investigated such action, but found the costs to do so would outweigh any savings gained.
THE CITY has only two ways to make money – through property and sales taxes or the rates charged on utilities and services.
The general fund is about $7 million, of which the majority comes from property taxes. Of the city’s 8.75 percent sales tax, $300,000 goes to Allen County Regional Hospital and another $300,000 goes to capital projects such as land purchases, trail repairs and bridge and road construction.
“We look at utilities as our business operations,” Fleming said, adding their budgets are kept separate from the general fund. Included are water with a budget of $2 million, gas $4 million, electric $10 million, sewer $1 million, and sanitation $300,000.
The city’s recreation department also has a budget of $485,000.
COUNCIL members could take some solace in knowing down the road new businesses such as G&W Foods and a hoped-for expansion at Russell Stover Candies will mean an uptick in revenues.
IN OTHER news, council members gave Eddie Radford two weeks to clear his property before they will consider bids to remove a trailer and shed.
Radford had until Aug. 8 to remove the dilapidated structures before the city would begin accepting bids. If the city pays for removal, the homeowner is charged for the expense.
“Please give me just a little more time,” Radford pleaded. “I’ll get it spotless. I’ll even rake the yard.”
Council members said that at their Aug. 28 meeting they would review demolition bids if Radford failed to live up to his promise.
DONNA Houser commended the city on the Iola Municipal Pool and how 30-40 adults regularly participated in water exercise classes and a handful regularly swam laps in the times set aside for such activities. “We really appreciated the clean water and pristine conditions of the pool,” she said.
As for her pet project, the football stadium, Houser said she’s busy raising funds to update the restrooms in the commons area, with the hope of making them handicap accessible.
MARK PETERS asked about the Diamond 3 stadium bleachers, noting several are damaged.
Councilman Wells said they were waiting for school to begin before working on the bleachers, including looking into whether aluminum would be better than the current wood.
As the current leader of the local Elks Club, Wells said its members are looking into this as a civic project in partnership with the city. “We’d like to get something more permanent, ideally before the start of next spring’s ball season,” he said.

Councilman Don Becker urged the council to adopt an ordinance concerning exotic animals, “so we can stop people from doing stupid things,” he said. Becker noted several instances in other states where animals such as pythons and alligators have endangered the general public.

Council members approved Fleming seek bids on a 1-ton flat-bed work truck to replace its 17-year-old model that’s “using a lot of oil,” a small tractor for the parks department, a police car and a forklift.

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