PORT ANGELES — It may be an understatement to say that the city of Port Angeles plans to make the most out of 2011.
The City Council on Tuesday voted 4-2 to adopt a $124.5 million budget for next year, which will increase spending by about 25 percent.
The increase is primarily because of more than $35.8 million that the city will invest in infrastructure in 2011.
That is about $22 million more than it will spend this year on similar improvements, known as capital projects.
The funding — which includes about $10.5 million in bonds, $12.87 million in other loans and about $9 million in grants — is likely the most the city has ever budgeted for capital projects, said city Finance Director Yvonne Ziomkowski.
The overall budget is also the largest she said she has seen in her 22 years at City Hall.
City staff members said the projects, some of which have been delayed for a couple of years, are necessary to comply with state and federal mandates and just maintain Port Angeles’ infrastructure.
“These are all needed improvements,” said City Manager Kent Myers, “and I think the taxpayers will appreciate it when the projects are completed.”
Not all of the council members felt the same way about the budget, which was approved in a 4-2 vote, with Brad Collins absent because of a death in his family.
Council member Max Mania, who voted against the budget along with Cherie Kidd, said he agreed with concerns raised in a statement written by Collins.
Collins wrote that he thought the city is taking on too much in 2011 and that it should not increase the electrical base fee from $10 to $13 per month next year.
Mayor Dan Di Guilio read the statement at the meeting on his behalf.
“The 2011 city budget should not include an 18 percent electrical utility base rate fee increase in 2011 or a 25 percent increase in the overall city budget in 2011 because of capital projects planned and scheduled years ago under better economic conditions,” Collins said in the written statement.
The largest single project in 2011 will be the city’s mammoth effort to get control of its sewage overflow problem, which is intended to bring the city in compliance with state and federal water-quality laws.
In November, the city acquired a large tank on Rayonier Inc.’s former mill site to temporarily store sewage and stormwater that would otherwise overflow into Port Angeles Harbor during heavy rainfall.
The city plans to award a contract for the first phase of the two-phase project to outfit the 5-million-gallon tank to receive the effluent and install new sewer lines to the site from downtown in the summer, said Glenn Cutler, city public works and utilities director.
Construction is expected to start next year and last between 18 to 24 months for the first phase, he said.
Work will likely be prohibited downtown between Memorial Day and mid- to late-October in order to avoid impacting the peak tourism season, Cutler said.
About $10 million will be spent this year on the project, all of which comes from low-interest state loans. The loans are being repaid by utility customers through a wastewater fee.
The total project will cost about $40 million and will be completed by 2016.
Next on the list is the city’s plan to replace nearly all of the analog electric and water meters, most of which are aged, with computerized versions.
About $5 million, paid for almost entirely by bonds, will be spent on that project next year.
Some of the other noteworthy projects include:
• First Street stormwater project, $1.6 million in federal funding.
• Replacing aged street light fixtures with energy-efficient versions, $1.2 million in bonds.
• West Fourth Street stormwater project, $1.1 million.
• Repairs to the Olympic Discovery Trail, Ediz Hook and Tumwater retaining wall, $1.06 million in federal grants.
• Downtown waterfront improvements, $500,000 from Economic Development Fund. (Another $2 million in grants, most of which the city has not received but plans to seek, is also budgeted for the project.)
• Paving First Street downtown, $225,000.
• New directional signs and entryway monuments, $156,440.
• Alley reconstruction, $125,000. (No alleys have been selected).
• New playground equipment at Shane Park, $60,000.
• Repairs to public bathrooms on Ediz Hook and downtown, $60,000.
Another $116,000 has been budgeted for undesignated street improvements.
The City Council approved the bonds for the projects in August. They will be paid off over 25 years.
City staff recommended using the bonds, rather than relying on reserves, because of low interest rates.
The city has about $43.626 million in long-term outstanding debt.
Asked if that is typical for a city of this size, Ziomkowski said she hadn’t compared Port Angeles with other cities. She added, “But with all the mandates, I think it’s not unusual.”
The budget includes no service cuts or layoffs.
But employees are being asked to forego pay increases and accept 2 percent increases in their contributions to their health insurance.
Negotiations with the four unions that represent city employees are ongoing.
The city budgeted for increasing employee contributions to health insurance by 1 percent and decreasing merit pay increases by 50 percent.
If the unions reject all of the concessions, the city would have to reduce its budget by between $310,000 and $330,000 or use reserves to make up the difference.
About $14 million in reserves will be used in 2011. Ziomkowski said that comes from budget savings from the last two years and funds previously set aside for some of the capital projects.
City Hall is projecting that Port Angeles’ economy will remain fairly flat in 2011, with building permits and sales tax revenue expected to remain about the same.
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Reporter Tom Callis can be reached at 360-417-3532 or at tom.callis@peninsuladailynews.com.
