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Performing well in face of adversity

Despite reports that most Oregon cities are struggling because of the recession, the City of Prineville is succeeding


The League of Oregon Cities recently concluded in its newly-released State of the Cities report that most cities statewide still face struggles prompted by the recession.

The report found that more than 60 percent of Oregon's 242 municipalities lack the financial resources necessary to maintain service level needs because of insufficient property tax revenue.

This has not been the case for the City of Prineville.

Although the economic downturn hit Crook County especially hard, leading to unemployment levels among the highest in the state, the city managed to weather the recession and emerge in good financial shape compared to other communities.

Prineville Mayor Betty Roppe acknowledged that Prineville endured the same property tax decline as many other municipalities, but city officials managed to minimize the impact.

"I think that part of the reason we are doing better than the norm is because we expected it (declining tax revenue)," she said. "We were proactive. We took steps to make sure that we weren't overspending or over-committing when we knew we would probably have a decrease."

To that end, Prineville City Manager Steve Forrester said that they right-sized staff to match declining revenue. City leaders made employment adjustments, chose not to replace positions when employees left, and consolidated administration.

In addition, city staff took advantage of the lower interest rates during that time.

“By restructuring our debt, we saved a significant amount of money,” Forrester said, “actually more money than we saw in decrease in property tax revenue.”

The city has also benefitted from the arrival of the Facebook and Apple data centers. Each year, the two companies pay the city hundreds of thousands of dollars in electrical franchise fees.

The State of the Cities report revealed that the financial condition of many cities has worsened between the 2009 and 2013 fiscal years. Again, Prineville is bucking the trend. During the past four years, the city’s general fund balance has steadily increased and in 2013, its assets exceeded it liabilities by $44.6 million.

“We have worked hard at implementing long-term modeling for general fund,” Roppe said. “We have updated some city financial policies.”

Going forward, city leaders may have an easier time improving their financial status. After enduring a 4 percent property tax slide during the recession, tax revenue is expected to increase this coming year.

As that increase occurs, city officials may operate more efficiently than before the recession.

“The silver lining of going through these hard times is we have done things like cross-train,” Forrester said. “We have become more efficient at the (Meadow Lakes) Golf Course in terms of man-hour productivity -- same thing at the (city) railroad and police department.”




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