When it met last in special session, the Watonga City Council trimmed the proposed budget. At the special meeting Monday evening, council members worked on the other side of the equation, revenue.
Items previously removed from the budget included a street sweeper and the Cherny Street project that came to more than $1 million. Other line items that were removed reduced the general fund expected expenditures by $6,000.
Several planned expenses with a hefty price tag were funded through restricted means, or dollars that can only be spent on those projects. For example, there is a deficit in the light and water department, but funds that would cover the red ink can only be used on the drinking water and wastewater plant projects.
Dacia Phillips of RS Meacham, the city’s accounting firm, explained that cities should use restricted funds on the projects first, rather than its own dollars, leaving the city with more leeway to direct the unrestricted funds to other expenses as needed.
Restricted or not, the majority of the meeting was spent dealing with waste, water and income. Council member Neal Riley wanted to know what the proposed increases in water, sewer and electricity base rates would look like.
Mecham provided rates from 10 other communities and the numbers showed that Watonga is, on average, between $17 and $30 lower in its access fee, or base rate.
“Well, that goes against the narrative that we hear that we’re the highest in the state,” said Mayor Ryan Bruner.
A forecast of where the utilities need to be to support the systems, maintain the facilities and pay the Oklahoma Water Resources Board loan payment is around $25 to access the system, or as a base rate among the three utilities, water, sewer and electric.
Riley asked if a capital improvement fee of $25 on all utility bills would satisfy the needs and the OWRB, which requires towns that take its loans to show their rates will create enough income to meet the payments.
Interim City Manager Karrie Little said there are only three choices; raise the base access rates, institute a capital improvement fee on utility bills, or make the revenue via consumption rate increases.
Phillips pointed out that the revenue from an increase in base rates is less restricted than a capital improvement fee on utility bills.
The proposed increases would bump the electricity base rate from $20 to $26, and water and sewer from $12 to $18 each. Consumption rates for water and sewer would remain the same in this scenario, while electricity increase by an already-planned 3%.
Riley, who seemed to be one of the only new council willing to speak his mind, said he still preferred the $25 fee. “It’s flat and it’s simple,” he said.
However, that could be negated, Little said, by consumers changing their usage behavior to reduce their bills.
Riley asked about holding town hall meetings to explain to the citizens what was being done and why, but received little support from the other council members. Debbie McGee, who had served as city clerk, reminded everyone of the 12 town halls held to explain the sales tax hike a few years ago, which had very poor turnout.
The council asked Philips and Little to pencil in the proposed changes and bring the revisions back to them. The budget in its preferred form will be presented for a public hearing at 5:30 p.m. May 20, prior to the city council meeting at which it will be voted on.
As Phillips put it, “You want what you publish to be very close, but what is published doesn’t have to be exact.”
City budgets can be revised by way of budget amendments, which come before the council and require a vote to gain passage and implementation.