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Bemidji City Council: New street light fees approved

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news Bemidji, 56619
Bemidji Pioneer
(218) 333-9819 customer support
Bemidji Minnesota P.O. Box 455 56619

City residents will see new fees on their utility bills later this year.

The Bemidji City Council Tuesday evening unanimously approved new fees that will be assessed to residents and business owners in the city limits.

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Beginning in May, residents will be charged $2.50 a month while businesses will be charged $5 a month to cover the costs of maintaining and operating the city's street lights. The fees will be billed per taxable parcel.

The "street light utility fee" is authorized by state statute, but Bemidji has never before implemented the fee, although the City Council did discuss it in 2003.

The council adopted the new fee as part of a comprehensive plan for cutting more than $550,000 from the 2009 budget and $600,000 for 2010.

The budget plan, presented by City Manager John Chattin and Finance Director Ron Eischens, exceeds for 2009 the expected cuts in Local Government Aid.

The cuts and new revenue sources will save more than $600,000 in 2010, but will not cover the expected $670,000 cut in LGA for that year.

However, between 2009 and 2010, the budget plan will generate more than $170,000 more than what is immediately believed necessary.

A new state budget forecast is expected next week -- and Chattin said city staff expects that forecast to prompt even further cuts to city aid dollars.

"Staff believes that when the new budget forecast comes out next week, we're going to be at risk for additional cuts," Chattin said. "I wouldn't be surprised if by the end of this year, we're going to lose some more."

The $1 million expected to be lost in LGA through the next two years is in addition to the "unallotment" of $230,000 in 2008 LGA funds that Bemidji lost in December.

The city now spends about $180,000 for electricity for the city's street lights and $30,000 to $40,000 for maintenance, according to Eischens.

"We're trying to recover our cost for maintaining the street lights," Chattin said.

The fee will be implemented per parcel, but the council did discuss whether it should rather be implemented per household or street address.

Eischens said the per parcel approach takes into account vacant parcels, which the per address approach would not.

City Attorney Al Felix said he expected that the majority of complaints from the public would come from residents who have multiple taxable parcels.

"I think you're going to have folks complaining that they are paying more than what they think is fair," Felix said. "That's going to be the big hurdle for you."

Eischens also noted that the street light fee would be charged to tax-exempt properties such as churches and schools.

"The goal is to impact all ... property owners," he said, explaining that the 1,500 city residents who do not have sewer and water will still receive bills from the city.

The City Council also considered a flat rate of $3.25 per parcel for all residents and businesses, but a motion on that option was withdrawn.

"That's a deal-breaker for me," said Councilor Roger Hellquist. "I don't think that's fair."

Councilor Ron Johnson asked if an increase to other funding sources, such as the city's electric franchise fee, would be more appropriate, but Chattin noted that the city this year raised the franchise fee from 50 cents to $1.

Johnson also wondered if the city could save some money by turning the street lights on later or turning them off earlier.

Staff said the lights operate on light sensors, which might need replacement in order for the sensors to be adjusted.

Also, City Engineer Craig Gray guessed that it would only save about $20,000, which could be less than the cost for replacement.

Councilor Barb Meuers said she expected that the new fees will be tough on those living on fixed incomes.

The street light utility fees are expected to be implemented in May, Chattin said, which will generate $133,000 for the city.

"We think this is a key part of our plan for budget reductions," Chattin said.

If the council opted against implementing the fee or to not approve other budget recommendations, Chattin said the city would need to consider more drastic measures.

"If we don't implement this, there will be layoffs," Chattin said.

The city could possible reduce its staff through attrition, he said, but that would be handled on a case-by-case basis.

Overtime cuts

Another budget recommendation, which has already been implemented, is the elimination of 50 percent of city overtime costs.

The city had budgeted $286,500 in overtime for 2009, but Chattin said department heads have been instructed to eliminate 50 percent of their overtime budgets.

"I haven't had anyone tell me it's not possible," he said.

The most difficult, he acknowledged, is overtime for the Bemidji Police Department, which comprises most of the city's overtime expenses.

But, one of the city's unions - the "49-ers," which comprises engineers - has agreed to a scheduling change in which workers will be paid overtime if they work more than 40 hours a week. Before, they had been paid overtime for any day in which they worked more than eight hours.

Now, Chattin said, workers will be done working once they hit 40 hours.

For instance, if a snow-plower was working during a snowstorm Friday, Saturday and Sunday and got his hours in by Tuesday, he would be done for the week.

Gray said the public might notice a change if they come in needing assistance on a Friday afternoon and no one is working.

"There will be a time when people, customers, need service but will need to wait one day," he said.

Other changes

In total, the city will implement 22 budget changes:

-- Overtime reduction of 50 percent, saving $143,250 for 2009 and 2010.

-- Establishment of a city dog kennel, saving $10,000 for 2009 and 2010.

-- New cleaning contract for City Hall, saving $9,079 for 2009 and $9,904 for 2010.

-- New cleaning contract for Public Works Facility, saving $7,440 for 2009 and $8,938 for 2010.

-- Increased township fire contribution, generating an additional $60,032 for 2009 and 2010.

-- Increased rental license revenues, generating an additional $15,000 for 2009 and 2010.

-- A $5,000 cost-savings for 2009 by purchasing a black-and-white copier versus a color copier for City Hall.

-- Termination of the meter-reading contract, saving $18,750 for 2009 and $25,000 for 2010.

-- Contract with Beltrami County for prosecution. Because the city is maintaining the support staff, this actually will cost the city an additional $44,438 in 2009 and 2010.

-- Savings of $8,000 in 2009 and $12,000 in 2010 from the reorganization of the Public Works Department following the expected May retirement of Public Works Director Andy Mack.

-- Revenue of $28,000 in 2009 and 2010 from the Bemidji School District for the cost of the school resource officer at Bemidji Middle School.

-- Deferment of a job classification study until 2011 will save $12,000 in 2009.

-- Elimination of a GIS intern for 2009 will save $8,750 in 2009 and $15,000 in 2010.

-- Elimination of an intern for community development will save $3,000 in 2009 and 2010.

-- Elimination of a temporary employee for the Engineering Department will save $9,000 in 2009 and 2010.

-- Elimination of comp time for exempt employees will save $42,000 in 2009 and $50,000 in 2010.

-- $20,000 will be gained in revenue in 2009 and 2010 due to the city's control of funds that had been going to the Joint Economic Development Commission.

-- Purchasing just 50 percent of in-car computers for the Police Department will save $40,000 in 2009.

-- The city will notify its unions and nonunion employees that it does not intend to pay cost of living increases for 2010.

-- Implementation of administrative fines will generate $20,000 in revenue for 2009 and $40,000 in 2010.

-- Implementation of a street utility light fee will generate $133,333 in revenue in 2009 and $200,000 in 2010.

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Bethany Wesley
(218) 333-9200 x337
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