The down payment on a water company and a police department plus a million-dollar gush of speeding tickets will triple Star Valley's spending in the upcoming fiscal year -- boosting it from about $1.5 million this year to a possible $5.5 million in fiscal 2008-09.
The increases include approximately $700,000 to finance the purchase of the Payson Water Company from Brooke Utilities including $200,000 in improvements, about $194,000 in police force startup costs, money for a new town executive assistant and about $900,000 in staff, court and law enforcement costs related to the town's twin photo enforcement stations on Highway 260.
On the face of it, the town's spending will jump by $3 million. However, the whole budget is still less than the current year's budget shortfall in the neighboring Town of Payson.
The apparent size of the increase is deceptive, said Town Manager Vito Tedeschi.
For starters, the town spent far less this year than its adopted budget of $4.3 million. That's because the town didn't buy either the local water company or a small privately owned sewage treatment company as budgeted in the current year.
Those two items accounted for $1.5 million of the under-spending. In addition, the town didn't receive a budgeted $500,000 worth of grants or spend a budgeted $500,000 on a new town hall.
So if you set aside the town's bid to hire it's own police force, buy a water company and process a flood of speeding tickets, then the $5.5 million spending plan for the coming fiscal year represents a "status quo," budget, said Tedeschi.
Star Valley's quiet budget process, year-end surplus and big increases for next year make for a stark contrast with neighboring Payson, where the budget appears to be bearing down on a sea of icebergs. The one Payson budget study session held so far revealed a roughly $5.5 million drop in budgeted revenue for the current year.
Sessions detailing actual spending for the current year have been repeatedly postponed, but Town Manager Debra Galbraith sent a memo to the councilors urging them to approve only urgently needed items. The Payson budget has been cratered by significant decreases in sales tax and a huge drop in building fees.
By contrast, Star Valley this year took in a little more money than it had predicted and spent far less, mostly due to the postponement of capital projects like the water company and sewage company buyouts.
The town council held one budget study session and on Tuesday adopted the tentative budget for 2008-2009 without discussion in one of its now-typical 20-minute meetings.
Small wonder, given the uniformly cheerful budget reports and updates.
For instance, Star Valley budgeted $250,000 for sales tax revenue, but ended up collecting about $400,000. Part of that comes from the windfall contractor tax payments that stemmed from highway construction work. The new budget anticipates $357,000 in sales tax for the upcoming fiscal year.
Building permit revenue did drop from the projected $50,000 to $40,000, based on the two or three building permits issued monthly by the town's one-man building department. The budget for the upcoming year predicts a 50 percent increase to about $60,000, based on the rising value of the new homes being built in the community notable for its large lots and rural atmosphere.
But the big change in income relates to the busily flashing photo speeding stations at each end of town. The $100,000 in revenue from magistrate court fines in the current budget will jump ten-fold to $1 million in the upcoming budget. Tedeschi noted that the million dollars is a rough estimate, based on several months of data that didn't include any of the busy summer travel months.
Tedeschi said 60 percent of that million dollars flows straight through the town's budget and into the state's coffers. Most of the rest of it pays for people to handle the paperwork and the private company that runs the system. Tedeschi's best guess at this point is that the town will net about $100,000 from the tickets which will go toward covering law enforcement costs.
All told, general fund revenues should increase from $1.4 million this year to $2.2 million in the coming fiscal year.
On the spending side, the big changes center on police, water and speeders.
Spending on law enforcement this year stood at about $270,000, the cost of a contract with neighboring Payson to pay for the dispatch of officers in response to calls from Star Valley residents.
Tedeschi said that Payson has indicated "in so many words" that it will not renew the current contract, which expires next spring. So Star Valley is now moving ahead with plans to hire a police chief, an administrative assistant and three sergeant-level officers, starting in about one year. The start up cost for the new police department will be about $194,300,
The ongoing cost of having its own police force will be about $600,000 annually, a little more than twice the cost of the current arrangement with Payson.
In addition, the law enforcement budget line includes $500,000 for extra costs related to handling photo speeding tickets.
The spending blueprint also sets aside up to $932,000 in an enterprise fund for water projects, half of which is the buyout of the water company. Brooke Utilities refused the town's initial offer of about $475,000 for the water company, so Star Valley is now preparing to condemn the local water facilities and ask a judge to set the price for a buyout.