08/12/1981 Meeting (2) - Laserfiche WebLink

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-- - ..---- . ,. e utility taxes earmarked for a separate fund for capital only. The Budget Committee makes recommendations about the moneys in the fund each year and what projects will be under way. It does not go to operations and maintenance. In one city where he worked they had a six-percent tax on all utilities and the fund was substantial (water~ gas~ TV, electric). It is a distributive tax. If one took the City's inventory now and tried to maintain it, the average cost per year would be approximately $20 million~ assuming that it had $20 million behind it for several years. This assumption has not been going on in Eugene. ~ssuming 2.5-percent growth, there is an added $10 to $12 million a year in capital that has to go to the infrastructure. That would be a minimum $20 million to $40 million per year for the next 15 to 20 years. Ms. Wooten suggested that they might consider slowing growth until they could catch up with capital improvements. Mr. Gleason replied that they could not tune the economy that finely. The City Council's choices would have impact 1 ater. They do not control enough of the agenda to do otherwise. He told the council they were on an aircraft carrier making a mid-course direction change and they can only make it so fine a correction. There are too many currents that they simply do not have control over. They will have to make more mid- course corrections. Councilor Miller arrived at the meeting. Ms. Wooten suggested with the conditions nationally it might be better to stabilize the Eugene capital improvements before making commitments to diversi- e fication. Mr. Gleason did not think things were as bad as others and pointed out in terms of employment, Eugene was worse in 1976. Mr. Obie interjected that if the City could diversify~ they would not be so dependent upon the interest rates. Mr. Gl eason added it woul d take three years to prepare the Four Corners area before it could be marketed. If they start now it would take ten years to have the sites in West Eugene ready for industry. They are trying to match public and private capital so their development occurs. They can get diversification, but not only through property taxes. Mr. Obie said $20 million a year is $1,000 a year per family, and that is a lot of money every year. Mr. Gleason recognized that he was oversimplifying because there were all kinds of capital schemes in it: Bancrofting, a tax on new development, user fees. The ~irport is a $29-million agenda funded by user fees. They have $2 million to build a building, at which time the City will get the fees to be repaid for the building. The solution to the River Road/Santa Clara problem has to be front-ended. The sewers must be put in before the money comes in. Mr. Gleason told the council that they will not notice that they are under-capitalized except in extreme dramatic cycles. They will con- tinue to under-capitalize if they use the oroperty taxes as the basis of support. Mr. Obie referred to the question of growth. He said they are having a problem with people in Eugene who are having economic difficulties. More and more of e their spendable income goes to the government and there is less for housing and less to live on. They might have super cities to live in, but their living MINUTES--Eugene City Council ~ugust 12, 1981 Page 4