Town needs revenue

We are at a fork in the road. Which way do you want to go? To the left the road appears level, straight and without winding curves, but you can only see ahead about a quarter of a mile due to heavy fog. On the right you see a road with a tough incline, rocks in the middle of the pathway and a creek to cross, but you see a bright little town sitting in a valley about a mile ahead. Did I forget to tell you that you have your grandkids with you?

Ok, you see where I am going with this. Do we manage the town for sustainability for the next generation or do we take the easy route, keeping our rates so low that we must continue to defer infrastructure maintenance? Keeping rates low sounds like a campaign slogan for re-election but not a phrase that allows me to sleep with myself at night. I will take that risk and attempt to persuade you to eagerly invest in Odessa, insuring that we remain a bright little town sitting in the valley.

With transparency and good communications, I will help you to understand our three enterprise businesses: garbage, sewer and water. Over the past 12 months, the Public Works Department has evaluated the status of the water and wastewater systems and is willing to take many incremental steps to improve deficiencies. We must maximize the return on every public dollar invested in public infrastructure and facilities. The enterprise businesses have independent budgets that are structured to pay for operations and maintenance and in addition must provide for capital improvements. When a pump, motor or pipeline wears out, we are expected to pay for it. I propose a 5% increase to water and sewer and a 3% increase to garbage. Collectively, this amounts to slightly over $5 a month added to the basic rate.

The current expense fund, commonly referred to as the “General Fund,” is another animal. This fund provides for police, fire, pool/parks, library, cemetery and streets to name a few. Revenue received for this fund is somewhat stable but limited. It comes from property-tax, sales-tax and state-shared revenues. Property taxes have not kept up with inflation since I-747 passed in 2002. Statewide, taxpayers have saved an estimated $1.6 billion in property taxes since this one-percent limit. This estimate is based on the assumption that, if the limit had not been in effect, taxing districts would have continued to collect the same percentage increase in taxes in 2002 and beyond that they did in 2001. Property taxes are now about 6.6% lower than they otherwise would have been. Odessa receives about $95,000 per year in property tax.

About sales tax – did you know that Odessa still has the 7.7% sales tax rate, while many cities and towns are much higher and some on the west side are at the 9.5% rate? Of those 7.7 cents per dollar collected locally, the Town of Odessa receives about a penny per dollar spent in Odessa, whereas the state gets 6.5 cents, and the county gets a small cut from the 1.2 cents remaining. Currently, the elected officials of Odessa remain adamant about leaving the sales tax rate at 7.7% in order for our businesses to remain competitive and to further promote implement sales, which in turn help to keep jobs in our home town. Other state-shared revenues have also experienced major cuts. Since I-1183 (privatization of liquor sales) and the McCleary decision (2009 education reform and funding law), Odessa has experienced a significant decline in liquor income, as the state attempts to balance its budget by lowering the share previously given to local governments. Liquor income is based on population, not on local sales. Keeping our homes occupied with families is the issue, not more local consumption.

So where is the rainbow, how do we fix this diminishing general fund? There is no silver bullet, but here are just a few options, in no particular order, that I will consider.

1. Increase job opportunities

2. Annex Odessa benefit areas

3. Create cemetery memorial fund

4. Protect our implement trade

5. Support small business

6. Research parks and recreation district

7. Support Friends of the Pool

8. Support Odessa Historical Memorial Fund

9. Update income survey

10. Be proactive in aquifer sustainability

11. Update Odessa Comprehensive Plan

12. Communicate with legislature

13. Provide infrastructure for a healthy business climate

14. Recognize and work with partners: Chamber, Hospital, School, PDA and You.

15. Re-evaluate other fees and service charges (open/close graves, dump fees etc.)

Odessa has shown resilience during tough economic times. We have tightened our belts, but now our pants are starting to fall off anyway. I propose easing into a sustainable future with modest rate increases for our enterprise businesses and a strategic economic development plan to boost our general fund. We have a challenge ahead of us.