Auburn’s financial situation is not dire, but it needs additional revenue to accommodate growth

City officials look at ways to raise money for the general fund

Auburn is growing, and will keep on growing, indeed within a few years its population will hit and surpass 100,000 souls.

Count on it.

Today, as city leaders make their plans to provide services for new residents in the next four to five years, they are aware that the time to act is now.

Limited at the moment to the annual 1 percent property tax increase, which does not keep up with salary increases and the like, the city also expects to lose a good chunk of the revenues on which its general fund has relied in recent years.

That includes the loss of the annual $4 million in streamlined sales tax mitigation revenue that Auburn has received for roughly the last 10 years.

All by itself, that is a big hit.

But as Mayor Nancy Backus reminded the City Council at a special meeting Monday, the sky is not falling, and the city is not headed to the poor house.

“We are not broke, and there are no dire concerns of being broke. The question is simply, how do we pay for the growth in this city that we know is coming? We can’t tell everyone, ‘You can’t come here, you can’t spend your money here, you can’t move your business here, you can’t build your home here,’ ” Backus said.

At Monday’s meeting, council members outlined their budget priorities, which differed here and there but agreed on the need to maintain essentials like water and sewer, policing, health and human services and help for the homeless.

Councilmember Claude DaCorsi recommended the city maintain its present employee base of 450 at least through 2024, though he recognized how difficult it would be for today’s contingent, staffed for the present population, to continue to provide quality services to a 100,000-plus population.

“If we continue to grow at the pace we are growing at and maintain 450 FTEs, we would be stretched much beyond what we are stretched currently,” DaCorsi said.

To raise revenue, DaCorsi and Councilmember Bob Baggett recommended a 3 percent levy lift and the imposition of a 10 cents-per-square-foot a year business and occupation tax on warehousing, manufacturing and storage facilities, which would raise, Baggett said, roughly $11 million each year for the general fund.

Baggett also recommended, beginning in the years 2020 to 2024, a 1 percent utility tax.

Deputy Mayor Bill Peloza, noting the old adage that “growth pays for growth,” said tax increases are inevitable.

Councilmember Largo Wales, who was absent from Monday’s meeting, arranged for Peloza to read her priorities into the record, which were police, followed by streets. She suggested that block grant money be spent on homelessness, that the city cut its funding to sister-city activities —“they are not a city expense — trim funding for any blue-ribbon committees the city may have and reduce administrative staff.

Councilmember John Holman cautioned that to approach the problem by way of priorities would pit city department against city department, with inevitable winners and losers.

In Holman’s view, all departments are critical and interlinked.

Working out how to pay for the inevitable in light of restrictions on the city’s present revenue streams has been the hot topic of many recent meetings.

But for now, Backus said, the city will hit the pause button on all that talk.

In the coming months, the mayor and her staff will take the budget priorities outlined by each council member and work behind the scenes with department directors and their staff.

Next Wednesday, Backus and city staff expect to meet with the Auburn Area Chamber of Commerce Government Affairs Committee to consider data provided by the city’s financial director, Shelley Coleman.

But, Backus stressed, the city is keen to have its residents and businesses involved in the discussions, adding “this will not take place in a vacuum.”

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