Fire merger plan may have an alternative
By ROBERT MEADOWS
Port Orchard Independent columnist
June 2, 2011 · Updated 9:01 AM
South Kitsap residents may want to consider a possible alternative to the regional fire protection service authority plan drafted by the planning committee, if they would prefer a regional authority that can survive on its own revenues.
The planning committee’s draft plan depends on payments from the City of Bremerton to fill a roughly $2.4 million annual funding gap that results from the regional authority’s inability to collect enough tax revenue within the city to cover Bremerton’s costs.
Bremerton’s payment obligation would last for five years, and then the regional authority and city would negotiate to see whether any further city payments would be made.
At the five-year point, the consolidation of the city fire department and South Kitsap fire district would have already occurred, so the regional authority would be over a barrel.
The alternatives to obtaining the city’s agreement to continue making annual payments of some amount would be to take the organization apart and end the regional authority’s existence or to cut total spending by approximately 10 percent.
Neither alternative is attractive, but forming a regional authority that cannot stand alone using revenues it can collect within its jurisdiction creates this situation.
During the committee’s discussions, an alternative funding arrangement was mentioned as a possible way to replace the city’s payment with other revenue at the five-year point.
The alternative is to authorize the regional authority to impose what are called “benefit charges” under RCW 52.26.180.
Rather than wait until after forming the regional authority to pursue this alternative, why not make it a part of the plan that is submitted to voters when they are asked to approve the plan and formation of the regional authority?
Benefit charges cannot be imposed later without voter approval, so asking at the beginning for their approval seems reasonable.
If voters approve a plan authorizing benefit charges, the regional authority would start its life with the ability to collect all the revenue needed to operate without depending on a payment from the city.
The first obstacle to including benefit charges in the plan is the requirement that at least 60 percent of voters approve any plan that authorizes imposing benefit charges.
Those who think a regional authority is a good idea would probably rather not raise the requirement to a supermajority by including benefit charges.
Another possible obstacle could be identified once the committee puts together a plan that specifies how benefit charges would be calculated and shows whether South Kitsap residents would have to pay more simply to cover Bremerton’s costs.
Since benefit charges can be high enough to cover 60 percent of the regional authority’s operating costs, it’s obvious they can eliminate the funding gap when combined with revenue from property taxes.
What isn’t obvious is whether benefit charges could be calculated in a way that makes Bremerton residents pay for their services rather than shifting their costs to South Kitsap residents.
A third obstacle is the effect on taxes paid by city residents to the city after the regional authority is formed and begins imposing its own taxes and benefit charges.
The regional authority’s maximum tax rate is reduced by 50 cents per $1,000 of assessed value if benefit charges are imposed.
The city’s maximum tax rate would be 50 cents per $1,000 higher, since the city’s rate is calculated by subtracting the actual tax rate of the regional authority.
City residents already face a possible tax increase if they begin paying the regional authority and continue paying the city’s levy, and this increase would be greater if benefit charges are included in the plan.
Authorizing the regional authority to impose benefit charges may be an acceptable way to enable it to operate on its own, but we cannot know unless the committee provides the details.
It would require approval by a supermajority of voters to impose benefit charges at the beginning or at the five-year point, so why not find out now whether this is an acceptable funding alternative?
Bob Meadows is a Port Orchard resident.