10-10-2016 Council Packet - Laserfiche WebLink

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MINUTES OF THE ORONO CITY COUNCIL MEETING Monday, September 26, 2016 7:00 o'clock p.m. 4. 2017 BUDGET AND PRELIMINARY LEVY — RESOLUTION NOS. 6675 and 6676 (continued) Walsh stated it also ties the hands of future councils for 10 to 15 years. In addition, the City would be adding another $120,000 of debt in every one of those years and then the next year the City will not have any money to maintain the roads. Walsh stated at the end of the day, if the City just bonds for it, the City will have no money the following year and they will have tied the Council's hands for the next 10 to 15 years. Walsh noted the City has spent a lot of money over the past 5 to 10 years, such as spending an extra half a million dollars on the police department project and purchasing an island. Walsh stated the City's budget needs to be prudent and sustainable and that borrowing for typical standard things the City should do is not prudent. Levang noted one of the things that could happen with a higher tax increase is that it will tend to keep going up in the future and that the City has an opportunity to decrease the tax rate rather than compounding year after year. Levang stated the City has not been able to pay for road projects and that a number of projects have been delayed. Levang stated with bonding for a million, the City will be able to tackle more of the roads, which makes the citizens happy. Levang stated improving roads is expensive and that she wants to see more roads improved. McMillan noted the City has used more than $400,000 in budget surpluses to repair roads over the past couple of years and that the City cannot bank on the fact that there will be surpluses going into the future. McMillan stated in her view the bonding will allow the City to complete more road projects, and that if the City does an 8 percent levy, they will get an additional $230,000, which will only repair Fox Street, but that there will be no additional money to do any mill or overlay projects or preventative work on the other roads. McMillan stated the City needs to reconstruct roads and maintain roads and that in her view the $1 million bond will give the City a chance to get a good start on those. McMillan stated in future years can use the Pavement Management Fund. Walsh stated the comment by the Mayor that the City cannot bank on the fact that there will be surpluses is right, but that is what the mayor has done over the past few years. Walsh stated if the City increases the pavement management fund to $400,000, then the next year the City will have $400,000 as well as the year after that. Walsh stated if the City bonds, they will have to come up with additional money to fund the debt on the bond and that it is not as simple as getting a million dollars. Walsh commented it is the City's obligation to fund the police department, the fire department, its infrastructure, and to have a sustainable budget. Walsh stated he will make sure that is done under his watch. Levang noted it takes a majority vote and that Council Member Walsh should not take sole credit for something that everyone voted on. Walsh commented that practice started the year he came on the Council. Page 7 of 26