City, Resort St. owners meet

Written by Pat Caldwell/Baker City Herald March 07, 2014 09:08 am

By Pat Caldwell

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A meeting Thursday at Baker City Hall between City Manager Mike Kee and members of the Resort Street Project Committee generated debate and questions and, perhaps, a way forward.

Members of the committee — property owners Randy Daugherty and Tabor Clarke — met with Kee, city Finance Director Jeanie Dexter and City Councilor Dennis Dorrah to discuss the issue of property tax assessments connected to the Resort Street Local Improvement District (LID).

Thursday’s session was initiated after the Feb. 25 City Council meeting where Daugherty, Clarke and property owner Rustin Smith testified during a public hearing about the final assessment costs of a $686,413 project to bury utilities on Resort Street last summer.

Daugherty, Smith and Clarke raised questions about how much of that cost they and about 40 other property owners should pay for burying power lines and other utilities.

Under the LID, the city planned to collect $295,000 from the property owners.

After the project was approved in 2012, the city borrowed $294,881 from the Anthony Silvers Trust Fund to ignite the venture, with the intention of recouping the funds from property owners in the LID. The city also disbursed $389,459.73 from the street fund toward the project.

The key element of the debate rests upon who pays for what and how much. Previously the Council agreed to assess each property owner at a rate of $71.50 per foot of frontage — the figure later dropped to $70 a foot — but some property owners said they expected their share to be much lower.

When the affected property owners were given a chance to oppose the LID in 2012, the owners of 12.73 percent of the footage objected, far below the level needed to stop the LID.

The council tabled the matter Feb. 25 and asked Kee to meet with the committee to examine whether a compromise is possible.

While Kee termed Thursday’s meeting “productive,” there still seemed to be uncertainty by some at the session regarding whether the city tried hard enough to capture proper savings on the project and the anticipated use of state Jobs and Transportation Act (JTA) Grant monies in the endeavor.

City officials said previously that the Oregon Department of Transportation determined that the JTA funds — about $150,000 — could not be used for the utility burial portion of the venture because the city held franchise agreements with the utility firms directly impacted by the project.

Daugherty emphasized during the session that he, along with other property owners in the LID, were willing to pay their fair share but the question of what price was equitable was still an open one.

“The property owners on Resort Street are willing to participate to do the job right,” Daugherty said Thursday.

The JTA funds appeared to be one critical piece to the entire saga for Daugherty, who said he was puzzled as to why those monies were not utilized.

“Why the state of Oregon was not willing to include undergrounding in the grant funds is beyond me,” he said.

Kee said the answer was simple.

“Because it’s against the law,” he told Daugherty.

“Initially they said the costs above ground could be offset by JTA funds,” Daugherty replied.

Another issue raised by Daugherty and Clarke was a perceived inability by the city to grasp all the cost savings possible on the project.

Kee conceded that Daugherty and Clarke were clear from the start of the endeavor that a key piece of the project was an effort to save as much money as possible.

“My goal was to just get the thing together. Your guys’ goal, and you always said, was to soften the blow,” Kee said.

Yet the effort to save all the money possible was not a priority by city staff, according to Clarke and Daugherty.

“The problem is we haven’t softened the blow (to property owners),” Daugherty said. 

“Nor, Mike, was there any effort to,” Clarke added.

After a great deal more discussion, Daugherty suggested an assessment of $25 a foot — instead of the original calculation of $70 at foot.

“That is a number I like. I think it is fair,” Daugherty said.

At $25 per foot, the LID would raise about $105,000, leaving a deficit in the project of about $189,000 that the city would have to make up from another source.

Kee agreed he could present that number to the City Council. But he questioned where the figure came from.

“It seems like it’s a number you are just grabbing and there seems like there is no theory behind it,” Kee said.

“We could put it at 0,” Daugherty said. “The property owner didn’t benefit from it (the project). I think, though, they (property owners) are willing to pay something. The city would not have gotten the LID if there wasn’t some type of assurances that every possible effort would be made to reduce those costs. And we didn’t get there. So now we need to just make it work,” Daugherty said.

Dorrah put the finishing touches on the session in a succinct manner.

“Are we going to sit down and help Mike out?” he asked.

Dorrah, Clarke and Daugherty agreed to put together a summary of possible solutions and email it to Kee for further action.

Daugherty emphasized that his $25-per-foot suggestion was a starting point, not a figure set firmly in stone and that it would be best to present the committee findings at the March 25 City Council session.

“They will get back to me to try to find a nexus of benefit to the property owners and to the city. My job isn’t to make decisions for the council but give them as much information as possible. This is purely a policy decision,” Kee said after the meeting.