Annual Town Meeting focused on where property tax money is spent in the city and how costs outpace revenue collections
More than 100 people packed the Forest Grove Community Center on Saturday morning for a crash course on municipal finance, which included reports from the police and fire chiefs, a slew of slides and even a peek at the mayor's tax bill.
This year's annual town meeting was titled 'Show Me My Money,' and a cadre of city staff members did just that in a variety of ways.
Mayor Pete Truax volunteered his property tax bill in order to help ground the discussion of tax disbursements, which can quickly become intangible without a real example to work from.
'It has a tendency to get out there in the ozone,' Truax said.
But offering up the bill wasn't much - it is a public record. The real heavy lifting was done by the city's assistant finance director, Susan Cole, Truax said, who used his bill to explain how city services were funded.
Cole noted that the majority of the $3,836 the mayor paid in taxes went to fund the schools. The city came in second place, with 31 percent going to city services and the rest divided between the Forest Grove School District (45 percent), Washington County (16 percent) and other local governments such as Portland Community College, Metro, TriMet and the Port of Portland.
Cole further dissected Truax's bill to show how the $1,207 he paid to the city was divided: $545.16 to police; $335.30 to fire; $78.45 to a bond measure; $67.33 to parks and recreation; $46.54 to the aquatic center; $38.13 to the planning department; $31.31 to the library; $21.28 to administration/legal; $5.41 to engineering; and $3.27 to 'other.'
The focus on Truax's bill set the stage for a discussion about the city's general operating levy, a voter-approved surcharge on property taxes that currently brings in about $1.5 million per year. The existing levy will expire in June 2013, and city officials plan to ask voters to renew it, perhaps as soon as this May.
A key question will be whether to keep the current rate ($1.35 per $1,000 of assessed value) or increase it.
A recent poll commissioned by the city indicated most voters would support extending the $1.35 rate (which accounts for $287 of the tax bill on Truax's home, which has an assessed value of $212,260).
The problem, as Cole demonstrated in a graph, is that the city's expenses are gradually rising, primarily as a result of employee health care costs and negotiated wage increases, outstripping the growth of projected tax revenues.
If all other factors were held constant, extending the current levy rate would leave a growing annual gap between tax dollars and city expenses that would reach $1.5 million by 2017, depleting the city's reserves.
If the rate were bumped to $1.60 (costing Truax $340), there would still be a shortfall, but the city's reserves could cover it - though they would drop below the level city officials would like. A rate of $1.85 (which would cost Truax $393) would allow the city to meet its expected expenses through 2018 and keep a healthy balance in its reserve fund.
During small group discussions, several people said they understand the desire to increase the rate to help cover rising costs of wages, benefits and services. At the same time, they noted that many residents, particularly retirees, are on fixed incomes and will find it hard to handle a spike in their local property tax burden.
Still, a poll of the audience showed that when given all the information, a majority would support the $1.85 per $1,000 rate.
But city officials know that people who give up a Saturday morning to learn about city finances are not representative of the general voting public.
However, City Councilor Camille Miller made it clear that doing nothing is not an option.
'There is no question that we must go for a new levy,' she said. 'We simply cannot provide the services that our citizens want or need without it.'
What's more, Miller said that in her opinion, 'we need to increase the amount of the levy to keep pace.'
And what should that rate be? 'We will cuss and discuss it,' Miller said, with a wry smile. 'Wish us luck.'