Some business leaders frustrated by Council's decision on Resort Street LID

By Pat Caldwell March 28, 2014 02:32 pm

By Pat Caldwell

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The action Tuesday night by the Baker City Council to approve the first reading of an ordinance that levies assessment charges on a group of local business owners might signal the beginning of the end of a long local political ordeal but the decision did not sit well with at least one merchant.

The Council voted 4-3 to accept the first reading of Ordinance No. 3329, the legal mechanism the city will use to extract assessment payments from property owners involved in the Resort Street Local Improvement District (LID). Businessman Randy Daugherty said Thursday the Council’s decision Tuesday night sent the wrong message.

“The Council is rewarding (city) staff for poor performance,” Daugherty said.

Daugherty was one of three business owners who first approached the City Council in February and raised concerns about the final assessment cost of the LID. At the heart of the matter were questions about how much property owners should pay for burying power lines and other utilities during the Resort Street Project. The LID was created by the city to fuel part of the overall bill to bury the utilities.

An LID is a funding system that provides for a group of property owners to share costs of infrastructure improvements.

The Resort LID money — $294,881 — comprises about 43 percent of the $686,413 venture. The city used $389,759 from its street fund for the project. After the project was approved, the city borrowed $294,881 from the Anthony Silvers Trust Fund to ignite the venture with the intention of retrieving the money from property owners in the LID. The city set a cost of $70 per foot of frontage for the LID.

In February, Daugherty asked the Council to eliminate the LID or refine the final assessment figure. The Council tabled the ordinance at that time and directed City Manager Mike Kee to meet with the Resort Street Committee to see if a viable alternative could be reached. After the Resort Street Committee convened in early March, the group decided to review the entire saga and submit some kind of proposal via email to Kee.

Daugherty, Clarke, Greg Sackos and City Council member Dennis Dorrah submitted a letter to the city before Tuesday’s meeting that suggested the LID be reassessed at $28 per foot of frontage. 

One of the central issues to the saga revolved around an idea that state Jobs and Transportation (JTA) Grant funds — used for the Resort Street reconstruction project — could be, or would be, utilized for the utility burial venture and thereby reduce the total cost of the LID.

Kee conceded that at one point there did appear to be a possibility the JTA funds could be used to offset costs. That idea, though, fell by the wayside after city officials learned that it was unlawful to use those funds for placing utilities underground. 

Daugherty said while the $70 per foot of frontage assessment was agreed upon by all parties, that figure was perceived as a maximum cost and to be used only as a funding safety net. 

“It was a combo of a lot of things that could have happened to reduce the overall cost of the undergrounding,” Daugherty said. “The property owners agreed to help and were under the assumption and expectation the city would help us. They didn’t.” 

City Councilor Kim Mosier — who proved to be the key vote at Tuesday’s meeting on the issue — said she spent a lot of time investigating the issue but in the end determined that the LID should go forward at its original $70 per foot of frontage.

“The more I looked into it the more I realized I couldn’t come up with a reasoned, logical deduction (regarding lowering the assessment fee),” Mosier said. 

“I did hear from a number of people who they, themselves, had paid on an LID and I would start out trying to explain to them. The more I tried to come up with a way to explain to those folks why a reduction was legitimate the more I just couldn’t.”

Mosier said she recognizes that there were individuals who felt the total cost of the LID assessment would be reduced.

“But it doesn’t change the fact that at the time it (the LID) was formed they agreed to a certain dollar amount. They agreed to pay for the project, $70 a foot,” she said.

Daugherty said the Council’s Tuesday night decision showed a majority of the elected board endorsed poor decision making by city staff. More should have been done to cut costs, he said. 

“They (the city staff) didn’t write a grant. They had two years to do that. It was a lack of ability to find cost savings. Bottom line is that they didn’t try,” he said.

 Tabor Clarke was another business owner who petitioned the city to reevaluate the final assessment cost on the LID. While Clarke said he was disappointed by the Council’s decision, he also believes it is time to move forward.

“It is what it is. We made our case and the Council made their decision and we move on,” he said. 

“I respect the Council’s decision and I respect the city staff’s presentation. Honestly, I’m looking forward to something more positive to get involved in,” he said.

Kee said that the property owners made some good points and that the work Daugherty and Clarke completed early on to convince fellow property owners to agree to the LID project was admirable.

“He and Tabor did a lot of work on this and went out there and really helped negotiate the utility costs down and talked to folks. I recognize they did a lot of work. They are good community members,” Kee said.

Daugherty said for him a sense of frustration still lingers regarding the project.

“It did not have to end this way,” he said.