When we created our Municipal Drainage Utility (stormwater) the city promptly moved it’s operations over the the Public Service Board.
These were costs that were formerly contained in the city budget. A new user fee was created and added to our water bills. The revenue exceeds $15 million each year. The city moved personnel and equipment and other costs over to the utility. There are now 104 people allocated to the utility with operating costs of just over $6 million each year. Another $1.3 million is paid to the city because, after all, they need our money. That brings the operating costs to just over $7.3 million annually.
What happens to the rest of the $15 million?
Before we go there remember that the city did not lower it’s budget or reduce our taxes when it moved the function out of the city general fund over to the utility. We are now paying those costs twice. Nifty huh?
Unfortunately the utility does not have a pay as you go attitude. The other roughly $8 million is used to fund construction of facilities. Actually the utility sells general obligation bonds and uses the $8 million to pay the principal and interest.
As an example, the 2013-2014 budget shows this:
principal $2,359,000 interest $3,216,968 total $5,575,968
We are paying more in interest than the value of the projects we are funding! Yes, not borrowing would slow down the construction. The reality is that there will always be flooding. We should take a prudent step-by-step approach to the solution and pay as we go.
We would get more than twice as much for our money and not saddle our children with more debt.
We deserve better
Brutus
elpasospeak 