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The city plans to spend $25.3 million on water treatment plant expansion in 2021-22

PMG FILE PHOTO - The Wilsonville Budget Committee recommended the approval of the city budget for the next fiscal year.

In a pair of meetings last week, the Wilsonville Budget Committee recommended the approval of the city's budget for the upcoming 2021-22 fiscal year. The budget shows that the city is upping its spending on construction projects — in turn leading to an overall expenditure larger than the previous year.

The document also indicates that potential wage increases from ongoing labor negotiations weren't factored into the equation and that the city is hiring new janitors and a police officer, among other items. Wilsonville City Council will ultimately decide whether to pass the document.

General outlook

Overall the budget is 8% higher this year than it was in the 2020-21 cycle.

The proposed budget totals over $241 million, up from $223 million in the current fiscal year and $212 million in 2019-20. Much of that increase comes from an $11 million uptick in spending on construction projects, deriving both from urban renewal districts and the city itself. The city's operating budget, such as personnel and materials and services, remained relatively flat.

Of the $60.5 million the city plans to spend on capital improvement projects, nearly half of that is planned to go to the expansion of the city's water treatment plant ($25.3 million) while it will budget $6.4 million on a Fifth Street-to-Kinsman Road extension, $3.4 million on the Boeckman "dip" Bridge and $5 million to eventually fund a bicycle and pedestrian bridge over I-5. Ninety-six other CIP projects will amount to 33% of the budget, Finance Director Cathy Rodocker said.

About 17% of funding from these projects comes from the city's urban renewal districts while 33% comes from system development charges, one-time charges paid by developers. The city also will receive $8.4 million from the city of Sherwood for the water treatment plant expansion.

The city also budgeted $10.1 million for capital projects and $29.5 million to pay off debt for its urban renewal districts — which take taxes associated with increases in property values and use them for infrastructure projects — for next fiscal year.

Projects those districts will finance include the Boeckman bridge, Fifth-Street-to-Kinsman Road and another project on Brown Road. Of the debt, $16 million consists of overnight loans from the general fund. This manuever allows the city to avoid expenses from outside bonding.

"In Oregon it (urban renewal) is the only tool we have. And quite frankly if we didn't have this as a tool to create the community we wanted, there are no funding sources out there," City Manager Bryan Cosgrove said.

In addition, the city plans to add 3.75 full-time employees next fiscal year. The city is adding three janitors who "will assist the City in maintaining an essential level of public health and cleanliness," according to the budget. Those positions are paid for via $5 million the city is receiving through the American Rescue Plan.

City must adjust following labor talks

The Wilsonville government administration is in the midst of negotiating compensation for city employees. Due to that fact, the city will need to go back to the City Council to complete a budget adjustment once those deliberations conclude.

So, for the purposes of creating the budget, the city pegged employee compensation at the same rate as it was last year. The city typically conducts labor negotiations every three years and recent negotiations led to increases between 1.5% and 2.5%.

Budget Committee member Paul Bunn abstained from the vote, stating that he didn't want to recommend the approval of a budget without a clearer picture of employee compensation and said he would be willing to meet again to finalize the budget once personnel costs are more exactly known.

The city agreed to send budget committee members updated information when the council is presented with the budget adjustment and members will be able to testify during required public hearings.

Cosgrove said he understood Bunn's concerns but that there was no way to avoid this timing issue.

"When we negotiate these contracts, these collective-bargaining agreements, we're mindful of the city's limited resources and what we can give to our employees," he said. "All that is at the top of our mind when we're negotiating — that we have to be able to sustain these employees' salary and benefits long term."

Budget committee member Shawn O'Neil, who is a lawyer, felt that trying to estimate an increase for the sake of the budget could give labor negotiators leverage to ask for more money.

In an interview, Rodocker said that labor cost increases will be paid for through savings, which she was confident would be sufficient to cover costs. If certain funds were exhausted, expenses would likely be reduced, she added.

Development fund struggles; building fund improves

The community development fund, which encompasses planning, economic development and engineering, is projected to face a budget deficit of over $756,000. Reserves and the general fund were used to address the shortfall.

Community Development Director Chris Neamtzu, however, painted a rosier picture for 2021. While development stalled a bit in 2021, he said the city had issued twice as many building permits in the first four months of 2021 than it had in the first few months of 2020. Neamtzu attributed this partially to the increase in the number of homebuilders in Frog Pond West from two to four. The fund's revenue is dependent in large part on development activity.

"We're seeing the uptick in the purchase and construction of homes in Frog Pond West as a result of the increase in diversity (of housing options)," he said.

Rodocker compared the state of the fund to that of the transit fund a few years ago and the building fund last year, both of which have improved since. Reserves for community development would drop to $0 by the 2023-24 fiscal year if no changes are made, according to city projections.

"We will never let this fund fail, but it is going to require a lot of time of staff going through and getting a better understanding of what funding sources (and) what funding is available for each type of service that is provided, making sure that the rate schedules are correct, when (was) the last time we looked at permits, fees. Everything is on the table when it comes to something like this," she said.

Speaking of the building fund, the city's 30% increase in permit fee charges approved last year resulted in stabilization and reserves for that fund are expected to rise in the coming years after falling precipitously the last four years. The city had not raised building permit fees in 14 years and will now adjust fees annually based on cost of living.

New officer coming on board

The city is in the process of hiring one new police officer, but that person will need to complete requisite training — which can take 18 months — prior to being on active duty.

Police Chief Rob Wurpes said that the increase in the number of parks the city owns as well as overtime burnout were a couple reasons for the needed staffing.

"I'm trying to be very thoughtful looking toward the future of what our needs will be," he said.

Wurpes also commented that officers leaving the profession entirely and fewer applicants due to the change in the perception of police recently has been a challenge for the Clackamas County Sheriff's Office, but that it is still able to find quality applicants.

"I'm a very optimistic guy generally but I can't sugarcoat this. I've never seen the resignations like we've seen today, and they are resigning to go to other professions," he said.


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