City declares 'fiscal emergency'
July 3, 2008 · Updated 1:11 PM
"There's a mood of anxiety among Oak Harbor employees as city leaders work on a budget that will almost certainly mean layoffs, Interim City Supervisor Doug Merriman said Friday.The City Council is schedule to approve a final budget Dec. 19, Merriman said, that will likely include one or two layoffs and three attrition positions that will go unfilled. Many different numbers have been batted around, but Merriman said it comes down to cutting $540,000 from the budget to balance it.The council members will also look at utility taxes once again Dec. 19. The current 7 percent utility tax expires at the end of the year, which contributes $400,000 to the budget. An earlier attempt to extend the tax for a year was rejected by council members.Councilman John LaFond suggested installing a smaller utility tax of 4 percent or even 2 percent as a compromise.Next year there may be up to 10 more job cuts if Initiative 722 is upheld in court or if proposed tax-cutting Initiative 252 passes. Yet none of the people who face layoffs will be identified for at least a few weeks and Mayor Patty Cohen will likely make that call.The council members passed a resolution Tuesday that declares a fiscal emergency for the city. The state of emergency puts more power in the mayor's hands, giving her the ability to unilaterally reorganize departments and lay off employees.We looking at staffing cuts across the board, in police, fire and City Hall, Merriman said.He also said the emergency resolution could affect some of the city's contracts. Personnel contracts, for example, guarantee a cost-of-living adjustment unless their is a fiscal emergency.The city has also contacted the federal government for information on a possible waiver of the COPS grant contract. The police department has four grant positions that have been funded 90 percent by the federal government for three years. Under the contract with the feds, the city is supposed to pay the entire cost in the fourth year - which is 2001.The contract, however, allows a waiver of funding the positions if the city has a financial crisis. Merriman said he's not sure if the city's position could qualify as an emergency. After all, the council could have simply raised taxes to cover the costs.Last month, the City Council voted to raise property taxes by only 2 percent instead of the maximum 6 percent allowed by law. The councilors cited I-722 - which, in part, mandates that property increases by limited by 2 percent - as the reason, even though legal experts say it will likely be thrown out by the courts.Merriman said the city has to look at staff cuts since the last four years of budget tightening has left little other options. But on the other hand, he says things like DARE, the city wading pools, the swimming lagoon and the police reserve program are still in the budget.He said the city will likely hold off construction on the new respite center that the Senior Center plans to build.Cohen is also still planning on hiring a new $106,250-a-year city supervisor. Merriman has been acting as both the finance director and the city supervisor since Cohen fired former supervisor E.T. Silvers early this year.On top of everything, Merriman said the city has something new to worry about. Tim Eyman, the architect of Initiatives 695 and 722, is already gathering signatures for a new tax-cutting initiative called I-252. Merriman said it's basically a rewrite of I-695, which was declared unconstitutional this fall. I-252 would require a vote of the people or a two-thirds majority on the city council to increase most taxes. -------You can reach News-Times reporter Jessie Stensland at firstname.lastname@example.org or call 675-6611. "