By John Colson
Sopris Sun Staff
Carbondale & Rural Fire Protection District’s board of directors expects to ask constituents for authorization for some kind of tax increase in the upcoming November election, but they do not yet know exactly how much they need or want.
But the directors recognize they need to figure it out pretty quickly, as the deadline is approaching to submit ballot language to the three counties in the district’s jurisdictions — Garfield, Pitkin and Gunnison.
That was the upshot of a July 12 meeting at which the board members directed the staff to alert the county clerks in the three counties that a revenue question likely is coming their way.
The deadline for that notification is July 28, and the district’s financial manager and public information officer, Jenny Cutright, said on Monday that the letter of notification will be sent out this week after it is drafted by Cutright and the district’s contract attorney, Eric Gross.
At the same time, Fire Chief Ron Leach has been directed to get to work on various budgetary scenarios that will help the board members in their discussion about the amount to be requested of the voters, the duration of the tax (will it be limited to two or three years, or longer) and any other issues that may arise.
The district two years ago won voter approval for a temporary tax hike of 1.75 mills (the district’s historic tax rate has been 5.903 mills) which was expected to boost the district’s annual revenues by approximately $595,000 this year, and would generate close to $640,650 in 2018 if it were still in effect, according to budgetary information provided by Leach.
A mill equals a dollar in taxation for every $1,000 in assessed valuation of a taxable property.
The 2015 mill-levy override came after several years when the district was operating on short rations due to a crash in real estate values during the recent Great Recession of 2008-09. The fire department’s operating budget and other fiscal needs are met primarily by property tax bills issued to residents and businesses in the sprawling 320-square-mile district.
During the recession, the district’s annual revenues dropped by an estimated 40 percent, and the district began making up the revenue loss by dipping into its cash reserves and slashing its annual budgets.
The voters in 2011 approved a mill-levy override that took the district to a tax rate of 8.0 mills for two years, and when that expired in 2013 the district board asked voters for another tax hike, this time without a “sunset clause,” or expiration date.
Voters rejected that tax hike overwhelmingly, handing the district a defeat that prompted a number of changes to the departmental operations and prodded district officials to begin work on a master plan, which had been promised by the district several years earlier.
The district now has a master plan in hand and has been linking that plan with its decision-making process.
At the July 12 meeting, Leach presented a budget that he termed a “no-growth budget,” meaning it reflected the expiration of the mill-levy override approved in 2015 but did not reflect voter approval of any new tax question for the coming years.
Among other things, the budget document called for the district to dip into its cash reserves, estimated to stand at $1.7 million at the end of this year, which would draw those reserves down to below $1 million by the end of 2018.
Leach’s no-growth budget called for a 2.8 percent increase in expenses in “all categories” to keep the district’s finances on a par with general inflation, including a 5 percent salary increase “across the board” for the paid firefighters and emergency medical personnel.
“This is about as conservative as we can get,” Leach told the board, adding that without some added revenues in the coming year, “the consequences would be severe” for the district’s operations.
Board member Mike Kennedy suggested the board could ask voters for an extension of the current tax rate, perhaps for three years, to see if rising property values might put the budget on a more sound footing by then.
The district already is hopeful about state-mandated bi-annual tax valuation data, which is expected to show a general increase in property values and thus an increase in the district’s revenues for the coming year.
But, Leach pointed out, that the county assessors offices will not release the information until Aug. 10, which is a day after the next fire district board meeting, meaning the information will not be available for the board’s next discussion of the tax issues.
The district has until Sept. 8 to submit final ballot language to the clerks of the three counties.
What: Fire District board meeting
When: Aug. 9, 5:30 p.m.
Where: Headquarters building, 301 Meadowood Dr.