Blaine residents could face a 10 percent increase in sewer rates as discussions over the city’s 2012 draft budget among city officials continue.
Blaine City Council will host the second of two public hearings at its November 28 meeting to gather input on the draft 2012 budget. City council will be asked to approve it and any sewer rate increases at its December 12 meeting.
The city expects to bring in about $4.7 million in the 2012 fiscal year while spending approximately $4.6 million. Compared to 2011, the city will take in about 0.6 percent less in revenue, Blaine finance director Jeff Lazenby said.
Lazenby said the city has not experienced any major decreases in sales tax revenue since 2011, but has experienced a 13 percent drop in sales tax intake over the past two years. Most of the city’s general fund revenue comes from sales taxes,
and total general revenue has decreased 7 percent over the past two years.
The city is not experiencing major increases in costs, though certain categories, such as auditing and insurance, have risen slightly, Lazenby said. Increases in salary for staff, if any, have yet to be determined because the city is still in negotiations with the unions that represent city employees.
City staff are proposing a 10 percent increase in sewer rates, though no increases to water and electrical charges, Lazenby said. An average Blaine resident would see his or her sewer bill go from $90 to just more than $99. The rate increases will pay for the ongoing debt service payments on the Lighthouse Point Water Reclamation Facility.
City staff have yet to determine how much, if at all, to raise Blaine residents’ property taxes, but Lazenby said city council must make this decision at their November 28 meeting. State law bars cities from raising property taxes more than 1 precent per year, but the city of Blaine has what’s called “banked capacity” because city officials have not raised property taxes in three years. Because of this banked capacity, city council can vote to raise property taxes anywhere from 0 to 4 percent for 2012, Lazenby explained.
The city has taken the biggest hit in lodging tax revenue, which is down 35 over the last two years, Lazenby said. The lodging tax, paid by anyone staying in a hotel or motel in Blaine, helps fund the Blaine Visitor Information Center and the Blaine Tourism Advisory Committee, in addition to other tourism-related promotions.
While most of the city’s sources of revenue have decreased over the past two years, one bright spot remains in the city’s 1-cent-per-gallon gas tax, Lazenby said. Revenue from this tax has increased 30 percent since 2010, and Lazenby attributes this uptick to increased cross-border traffic and rising gas prices in Canada. State law allows border towns, such as Blaine, to charge the gas tax, but Blaine does not have the authority to raise it above 1 cent per gallon.
The city is also facing a number of unknowns in the 2012 fiscal year, including changes to the state’s 2011/2013 budget. Governor Chris Gregoire is proposing, among other things, to withhold Washington’s cities’ share of state excise liquor taxes as part of a plan to fill a $1.7 billion budget hole. For Blaine, this would mean $122,000 less per year, which is about 3 percent of the city’s 2012 budget.
Blaine City Council will hold a public hearing on the draft 2012 budget at its Monday, November 28, meeting. The meeting starts at 6 p.m. at Blaine City Hall.