Rathdrum Council approves $16.4 million budget

The Rathdrum City Council reviewed the pros and cons of not increasing property taxes by up to 3% last week, before approving the city’s $16.4 million 2024 budget.

“The city of Coeur d’Alene basically admitted in The Press that they’re in a huge financial mess, and they’re taking a 3% property tax increase,” Councilman Steven Adams said. "Basically, by not ever taking any tax increases since 2019 are we setting ourselves up for a future financial mess here, like Coeur d’Alene?”

In 2023, growth and impact fees increased the city’s budget on their own, without a need to raise taxes, but there are some concerns that if growth slows the city could have staff positions with no source of funding.

“Our new construction exceeds the value of a 3% increase, where Coeur d’Alene’s does not,” City Administrator Leon Duce said.

If the city's new construction stops, Duce said, the only way to keep up would be to take additional property taxes.

“One of the areas that I’m very concerned about is our snow removal service in my opinion over the many years I’ve lived here, has gone downhill,” Oliver said. “I don't think that new growth money coming into town is enough to keep our services where they need to be. If … we have a downturn in housing or new development, we’re really going to be in a very short place, and I don’t think we need to go there.”

This year, the Rathdrum council added a new snowplow, and the 2024 budget includes money for a new snowplow driver, so snow removal could improve, but that position was largely covered by money from new growth.

“If we use our money from new construction to support our people,” Oliver said. “If that new construction goes away then we may not have any money left for that person.”

Those positions are covered by the taxes from growth, Duce said, but on a delay, so the growth impact fees cover the gap from the delay.

Not taking a 3% increase is a risk for cities, Rathdrum Mayor Vic Holmes said, because the 3% is cumulative and once the opportunity to raise taxes has passed that cumulative increase is lost.

“In a few years I see us trying to limit growth,” the mayor said. “If the growth were to go away, we would absolutely be raising taxes 3% and it wouldn’t be enough. Which is a mess that Hayden has found itself in and other cities down south.”

The 2024 budget is balanced with $148,000 in unallocated funds, which Duce hopes to use for things like crosswalks and flashing pedestrian beacon signs at Lakeland schools.

“We have done an awesome job of trying to make sure that this (budget) meets the public’s needs,” Duce said. “And as every council member has pointed out in every meeting that we have not raised property taxes this year. I think that we have been fiscally responsible with the taxpayers' dollars, not only this year but every year.”