The deficit-plagued state government will cut money promised to Payson for street maintenance by at least $171,000 in the upcoming fiscal year, prompting the town to eliminate much of its routine street maintenance in the next 12 months, said Town Engineer LaRon Garrett.
Star Valley will suffer a $24,000 cut as a result of the legislature's decision to keep a larger share of the gas tax dollars, but in Star Valley the money will come out of a reserve fund and not affect ongoing maintenance, said Town Manager Vito Tedeschi.
The 10 percent reduction in gas tax money going to cities will prompt Payson to essentially skip a year in its chip sealing program, which normally treats about 15 miles of road annually in order to cover 105 miles of paved streets in town once every seven years, said Garrett.
Councilor Michael Hughes said the fresh cuts come on top of the $500,000 the council had already squeezed from the street maintenance budget.
"We've done everything we can," said Hughes. "We've cut to the bone. Citizens need to let the legislators know what they think of this. Maybe if people get upset, the state will put it back in. But people tend to blame the council -- and it's already been a screaming match."
Payson will still get $1.7 million in gas tax funds passed along by the state, although state officials have not ruled out additional cuts as well as reductions in promised revenue sharing funds.
"It'll just set back the rotation for one year," said Garrett. "Even if we get funding back next year, no way we can make it up in one year."
The bad news from the state worsens Payson's already bleak budget picture for the fiscal 2008-09. Revenues this year remained flat, which means they came in $3 million below projections.
By the time the town adjusted to the decline in projected revenue, it had spent its entire reserve fund. The budget calls for virtually no increase in revenue for the upcoming fiscal year, which triggered an 8-10 percent cut in the department budgets and the elimination of most capital projects.
News of the 10 percent cut caused less angst in Star Valley, where Tedeschi said he'd already anticipated the reduction.
Star Valley gets about $250,000 annually from the state for its promised share of the gas tax. However, the town only spends about $100,000 to $150,000 annually on road maintenance. He said that for the past two years, the town has put about $200,000 in gas tax money into a reserve fund, saving it for major street overhauls planned in 2009.
Tedeschi said the town has been promised a $600,000 grant for the widening and overlay of Moonlight Drive and needs to save $400,000 in matching funds from its share of the gas tax.
The $24,000 cut in current funding essentially came out of that $200,000 reserve, said Tedeschi.
Even so, further cuts could come down later in the fiscal year, he said.
"We won't really know for sure until 10 months into the fiscal year," he said. "My feeling is, they'll have something figured out by then."