Sales tax revenues slipping in Hayden

HAYDEN - The city of Hayden's general fund budget is primarily made up of property taxes and sales taxes.

Its property tax rates are low by comparison to other nearby cities, and its sales tax revenues have been slipping and slipping.

Right now, the city receives $0.95 for every $1,000 of taxable value on property within its limits, city officials said. Compare that with $4.91 for Coeur d'Alene, $4.95 for Post Falls, and $4.03 for Rathdrum.

Couple that with the fact sales tax revenues to the city have gone down. Those revenues were at $1 million in 2008, versus about $750,000 now being shown in the preliminary budget for 2011.

Simply put, "It's a challenge," said City Administrator Stefan Chatwin.

He said the sales tax projections for 2011 are conservative, to be safe. They're about flat compared to what will likely be received in the current fiscal year.

"I believe that we're going to do better, that's my opinion," he said.

The City Council conducted a public budget workshop Tuesday with senior staff at City Hall. The city will have another budget workshop next week at 2 p.m. on Tuesday. The City Council is tentatively scheduled to adopt it on July 13.

"It's a tight budget," said Mayor Ron McIntire.

"I really like this budget," said Councilman Dick Panabaker.

Projected revenues for 2011 are at $2.7 million, said Chatwin. That would be up from the $2.6 million projected for this year. There still are three more months left in the current fiscal year.

The city has to balance its budget, so expenditures would have to match the projected revenue number. The city does have nearly $3 million in its emergency fund.

"We need additional revenue sources," Chatwin said. As early as 2012, the city won't be able to afford the level of services it currently provides, he said.

City residents are going to have to make some difficult decisions about services in the next two to four years, he said.

The city can't raise property taxes more than 3 percent in a year. On a typical $200,000 home, a 3 percent increase means an additional $27 in a year. That would mean about $26,000 overall for the city to use for park and street maintenance and provide other services. City officials point out that amount wouldn't go far.

City residents themselves would have to choose a greater increase.

The mayor in his most recent newsletter said if additional funding does not become available, then services will need to be cut and, in some cases, eliminated completely.

Chatwin said there are no plans to make cuts in the preliminary budget for 2011.

At the budget workshop, city officials discussed measures to increase efficiency in the services already being provided.

"We're squeezing every ounce of productivity we can out of our people," Chatwin said.

The city is looking to make one temporary, part-time information technology position permanent.

City officials also discussed the possibility of hiring a plumbing inspector, or contracting with one, or even sharing an inspector with other jurisdictions. The City Council members told the staff to gather information about that, but expressed concerns about how such an expense would fit in the budget.