By JAN LARSON McLAUGHLIN
BG Independent News
Last week, City Council sat in council chambers discussing where to get money to fill a shortfall in the city’s general fund.
This week, the Board of Public Utilities sat in those same seats, and suggested that council members look elsewhere to solve the general fund problem. The utilities board defended the money set aside for water and sewer projects – and protested efforts to solve general fund deficiencies with utility capital monies.
That money, which comes from a portion of the city’s income tax, has served the city well, according to board members.
“It’s really come into focus how well this has served our city,” board member Bill Culbertson said. The funding has allowed the utilities department to replace substandard waterlines and install sewer lines without assessing more to residents.
“I’ve really seen what we’ve been able to do with our water plant,” Culbertson said. “I look at other communities who have gotten in trouble with their infrastructure” when cities short the utilities funding. “Quite frankly, I’d like to see it stay in place.”
City Council has discussed several options to beef up its general fund revenue that has lost much in state funding cuts. To fix the ongoing problem, council is looking for about $800,000 from one or a combination of three options:
- By charging a tree trimming assessment.
- By charging residents for trash pickup.
- By changing the distribution of the city’s income tax revenue. This is the only option that would require a vote by citizens.
Utilities board member Mike Frost worried about the slippery slope that could occur once the city starts filling holes in its general fund with utilities money.
Board President Megan Newlove questioned the wisdom of changing a formula that has worked well for the city for more than 40 years. She noted that funding cuts would likely lead to deferred utility projects that have been planned far in advance.
“Once you push off one thing, then you push another thing off,” she worried.
Newlove also warned that cuts to the utilities budget could lead to rate increases – on top of already planned rate hikes. And she noted the economic development value of the current formula that allows the utilities department to lay the foundation for industrial projects in the city.
“That’s how we sell ourselves,” Frost agreed.
Board member Amy Craft Ahrens said the utilities department could come up short in the future when emergencies occur.
Brian O’Connell, director of the public utilities department, explained the history of the department when it comes to assisting the city. Over the years, there has been an ongoing understanding that the utilities department would pick up some general fund costs “to help make ends meet,” O’Connell said.
For example, the department shares in salaries and benefits for other divisions, brings in a kilowatt hour tax, and shares interest income from utility investments.
“We have over the years helped where we could,” O’Connell said.
Newlove told City Council members in the audience Monday evening that she sympathizes with their dilemma.
“I don’t envy City Council having to make these decisions,” she said.
But she warned of an unintended consequence if council took money from the utilities fund.
“If we have a shortfall in our budget, it may end up increasing rates,” she said.
“We’re all on the same team here,” Culbertson agreed. But the low utilities rates are what help attract business to Bowling Green – and that helps generate tax revenue for the city.
“When they add employees, they add income tax,” he said. “We all win if we have increased employment.”
Frost mentioned a company in Bellard Business Park that is currently expanding due to the low electric rates here. TH Plastics is adding 75 to 80 jobs.
Several council members were in attendance to listen to the board of utilities’ comments. Bob McOmber, chairperson of city council’s finance committee, explained the need for the general fund revenue to recover from its structural problem. “It will get worse year by year if we don’t do something,” he said.
Nearly 15 percent of the general fund revenue has disappeared, primarily from cuts out of the city’s control, he said. “The rug was pulled from underneath us and we don’t think those funds are coming back.”
McOmber said the city is faced with either having to charge citizens more for the services the city provides, or having to cut the services already in place. He also mentioned that the amount of money Bowling Green sets aside for its public utilities is very “generous,” especially compared to other communities.
City Council’s Committee of the Whole will meet again on June 19, at 6 p.m., in hopes of formulating a plan. “We will try to make a good decision,” McOmber assured the utilities board.
In other business at Monday’s meeting, the board of public utilities agreed with O’Connell’s recommendation that the city donate property previously used for a water tower to Habitat for Humanity.
The site, at the southwest corner of Manville and Clough streets, no longer has a use for the utilities department, O’Connell said.
So the board agreed to donate the property, convert it into two lots for two Habitat homes, rezone it to residential from S-3 industrial zoning, and extend water, sanitary and storm sewer to the site.
Mark Ohashi, director of Habitat for Humanity of Wood County, said he is very excited about being able to build the first Habitat homes in Bowling Green. Ohashi said he is hoping two homes can be constructed in the summer of 2018, and that a partnership can be made with Bowling Green State University on the project.
“It’s a great use of that space, for sure,” Frost said.
Also at the meeting, Assistant Municipal Administrator Joe Fawcett said the speed limit has been lowered temporarily to 25 mph in the construction area of Conneaut Avenue.
At the end of the meeting, the board went into executive session to discuss real estate, but did not take action following the discussion.
