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Residents ask City Council questions about Measure K.

By: Stephanie Dumm, News Messenger Reporter
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The mood inside McBean Pavilion Tuesday night was serious at some times, relaxed at others, and sometimes comical as 60 community members listened and asked questions to city officials about Measure K. Council members decided at the Aug. 10 City Council meeting to hold the workshop to provide answers to questions about the tax, also known as the utility users’ tax (UUT), according to previous News Messenger reports. Tuesday’s workshop was split into two sessions, with one hour before the City Council meeting, and an additional hour after the regularly scheduled council meeting. In total, 19 residents asked questions and directed comments toward both the City Council and staff. Some residents addressed the council and staff several times, including Tom Augustine, David Gordon, Terri Robinson and Randy Walter. The workshop began with a slideshow presentation about the city’s five-year forecast. City Manager Jim Estep said the beginning balance of the 2010-2011 budget was a negative $440,000, with an ending balance of $700,000, “assuming no utility users’ tax.” “We started off with a balanced budget for this year using one-time revenue from a land sale and $1.1 million from the city’s General Fund reserve,” Estep said. “That’s how we’re balancing the budget this year, presuming we will lose four peace officers in January 2011.” How text messaging and Internet services would be separated from mobile phone bills so just the phone portion would be taxed was addressed several times during the meeting. Anna Jatczak, the city’s assistant city manager/ chief financial officer, said the tax would not be applied to text messages and Internet on cell phones “if phone bills are itemized.” Bundled services were more complicated. “It’s been my observation in other cities that telephone providers break out different services, not that we can guarantee that, but I have seen that,” Jatczak said. “Since (cell phone) providers know it’s illegal to tax those items, they would have a mechanism to take that out of the calculation.” Randy Walter said he has children on his cell-phone family plan who live out of state, and wanted to know if he’d be taxed on their phones. Jatczak responded that cell phone bills will be taxed based on billing address. “So if I changed to a P.O. box in Roseville, will I not get taxed?” Walter asked. Jatczak responded by saying, “I’m not going to answer that,” amid much laughter from the audience. “It’s your choice on where to have the bill sent to,” Cosgrove said. Resident Kristine Miller wanted to know if the city has ever had a utility users’ tax in the past. “Yes, about 17 years ago. It was imposed by the City Council, and four City Council members were recalled and the UUT was rescinded,” Mayor Tom Cosgrove said. “The difference is that the community did not have the opportunity to vote. It’s on the ballot and the community will decide whether the utility users’ tax is implemented or not. I think that’s a big difference.” Jatczak said there would be “no additional administrative costs for collection of the tax. “The utilities will not add surcharges for collection or administering the tax, nor will the city,” she said. “If the tax is approved by voters, the cost will be absorbed internally with existing staff in the finance department.” Resident George Paddeck wanted to know what would happen if taxes collected surpassed the funds needed to maintain General Fund services. “It’s a contract and can be changed,” Cosgrove said about the measure. “The changes that are allowed by law are reductions and take-aways that would favor the citizens. We can’t add anything additional.” The repercussions for the misuse of revenue generated by the measure was also discussed. “If the city used money in a way it’s not supposed to be used, is the money replaced? How does that work?” Terri Robinson asked. Jatczak said the transaction would be reversed “if there was an incorrect expenditure.” “Would you consider it a misuse of funds if everyone in the recreation department got a 50 percent increase because there were funds available, and if that’s a misuse, how would that be corrected,” Jean Ebenholtz said. Jatczak said that would, indeed, be a misuse of funds. “I can’t envision that an approval to do so would occur. That would be up to the governing body,” Jatczak said. Richard Mackirdy had concerns about privacy, specifically regarding the sharing of personal information for those being taxed. “It’s not envisioned that the sharing of service users’ personal information in regards to how much of the tax is collected,” Jatczak said. “We’d have the same responsibilities now as related to city utilities, and when get set up an account, we get your social security number, and we’re governed by law to keep that confidential.” During the break between workshop and council meeting, The News Messenger asked a handful of residents about the workshop. “It’s informative. I think this polarizes portions of our city,” Michele Hutchinson said. “I think the city is working at getting the message out of why we have this Measure K and it’s so important. “ Hutchinson said this is because the city is “very, very divided.” “It’s an opportunity to stand up and be heard,” Don Chandler said. Randy Walter said he wished the workshop had been longer previous to the City Council meeting. “I think it’s too short. I wish they were up there longer because some people are going to leave,” Walter said.