Allen County commissioners left Iola hanging over a financial precipice Tuesday morning. THE COUNTY’S inaction leaves Iola in a pickle, City Administrator Carl Slaugh told the Register. MEANWHILE, county commissioners received a first-draft copy of the county’s 2015 budget, which included a mill levy increase of 6.418 putting the total at 77.573 mills.
After agreeing last week to consider providing some relief in the face of a nearly $400,000 ambulance service shortfall, Commission Dick Works dismissed discussion by saying, “Let’s wait until October and see how finances are going.”
“They (the city) can take out of their reserves or we take it out of ours,” Works observed. “They signed the contract.”
The contract calls for Iola to provide ambulance service with the county’s contribution being up to $750,000 from run revenue, plus purchase of replacement ambulances by the county.
A week ago Iola asked for $189,000, or half the shortfall, from the county’s ambulance fund, which has about $446,000.
Commissioners voted unanimously to consider the request with the provision that Iola would be obligated to repay the amount if it decided to hand ambulance service back to the county.
Commissioner Jim Talkington’s observation that the “city wants to know quicker than October,” with it in the midst of figuring its 2015 budget, stirred no change in the brief conversation.
County Counselor Alan Weber said he had prepared an addendum to the contract to facilitate financial assistance on the county’s part.
“I guess I’ll put it on the back burner for now,” he concluded.
“It’s clear we have expenses we don’t have budgeted,” he said.
And while the county is under no obligation to act, the city has no such luxury, Slaugh said.
“Waiting limits our options,” he said. “The longer we work without resolution, the more difficult it’s going to be, and the longer it’s going to take to recover.”
Slaugh rattled through funding options to cover the shortfall, noting some — such as increasing sales or property taxes — could not be enacted before 2015.
Increasing utility rates or adding a surcharge, similar to a stormwater fee already in place, are the most viable options.
Tacking on $5 monthly for each electric customer would draw about $70,000 by year’s end, if it’s enacted before Sept. 1, Slaugh said.
That still leaves Iola about $300,000 in the hole.
The other option is to transfer more money out of its utility reserves. The city annually supplements its general fund with such reserves, most notably its electric and gas funds.
As of June 30, the city held $1.5 million in its electric fund, and $1.6 million in its gas reserves.
Neither is at the level at which Slaugh prefers.
“Our published goal is to have three to six months operating capital in reserve,” Slaugh said, meaning the city should retain at least $1.5 million to $3 million in its gas fund, and $3 million to $6 million in electric.
“We’re way behind what we should be,” Slaugh said.
In any event, any maneuvers the Iola City Council approves between now and Dec. 31, or for the duration of the five-year contract, amount to subsidizing the county service locally, Slaugh concluded.
On Monday, Iola councilmen opted to wait until their next meeting before deciding on funding mechanisms, in case the county were to release any funds.
Works was quick to note that “it is the first draft and the levy will go down” as commissioners examine it closely. “We’ve already found several places to cut.”
If the budget were to fly, it would project expenditures of $7.7 million, incuding $4.2 million through the general fund. Ad valorem tax dollars would account for $7.7 million.
Commissioners selected a bid from Welborn Sales, Salina, for 900 linear feet of large diameter culvert pipe for road work. Welborn’s bid of $39,897 was the lowest of four.
Bill King, director of Public Works, said oil was being applied to four miles of Delaware Road, running four miles to the east from the old Zillah School east of Humboldt. He predicted the improvement project, started last year, would be completed today or Thursday at the latest.
Commissioners refuse EMS aid
