Albany City Manager Peter Troedsson told the City Council last year that the costs of running the city were outpacing revenues and, to remedy the problem, staff was exploring several options, including a utility fee.
The logistics of instituting the fee, Troedsson said, were like building a car — when and if the council decided to implement the fee, it would be ready to go.
During a virtual meeting on Monday, he told councilors that the time was growing near to decide whether or not they wanted the keys.
The city was already facing a budget crunch before COVID-19 further impacted municipal budgets across the country. During the last budget cycle, positions were terminated and frozen with the warning that further action would most likely be needed during the next budget cycle.
Property tax, Troedsson said, does not cover the city’s expenses and without additional revenue, city services could be cut.
It’s not simply a matter of living within one’s means for the city, however; the local government is bound by legalities that force its hand when it comes to certain payments. Payroll expenses, for example, grow with requirements of the Public Employee Retirement System, or PERS. In the Fire Department, a certain number of firefighters must be present on an engine when it leaves the station — if the city cannot afford the number of employees necessary, that engine is no longer on the streets. Health insurance costs for all employees, Troedsson said, are also rising.
The implementation of a utility fee, he said, would fall in line with what several other cities around the state have done and provide long-term funding for the city. The exact amount of the potential fee has not yet been settled.
The council can implement the fee without sending the question to the voters — an avenue it has been reluctant to use over the last year of discussions. However, in November, three of the council seats changed hands.
The council is set to consider a decision on implementing the utility fee during its March 24 meeting.