More Money

The City Council will consider a number of 'revenue enhancements'--including a trash-fee hike

Most politicians will do just about anything to avoid saying that they support a tax increase, particularly in an election year.

So it's no big surprise that when City Manager Mike Hein delivered a report to the Tucson City Council on ways to bring in more money to counter sinking city sales taxes, he called it an "Analysis of Potential Revenue Sources."

Hein's revenue-enhancement memo--a response to council members who wanted to know the range of financial options as they work to bridge an estimated $80 million shortfall in the budget year that begins July 1--is filled with what you might call "creative solutions."

There's a plan to raise an estimated $1.6 million from Tucson Water users by creating a pseudo-property tax on the water utility's property, which now pays no property taxes. There's a proposal to raise $3.4 million by increasing the tax on other utilities inside the city limits. There's even a pitch to implement a new tax on tanning salons that would raise $15,000 a year.

There are proposals--such as a tax on advertising revenues (worth $964,000 annually) or residential rental payments (which would raise $12 million)--that were rejected by a City Council largely controlled by Republicans (with the help of Democrat-turned-independent Carol West) earlier this decade.

And there is a politically sensitive proposal to raise the $14-a-month trash fee enacted by that Republican council.

Current council members Nina Trasoff and Karin Uhlich, Democrats who will seek re-election this year, disparaged the "garbage tax" when they ran for office four years ago, arguing that its creation demonstrated the insensitivity of their GOP opponents.

The women also criticized Republicans Fred Ronstadt and Kathleen Dunbar for hiking fees for Parks and Rec courses. Hein's memo suggests that the city could increase those fees, which were rolled back when both women took office.

Trasoff did not return a phone call from the Weekly, but Uhlich said that fees for Parks and Rec classes may need to be boosted. She says the cuts in the fees in 2005 were pushed by Councilman Steve Leal at the first council meeting she attended.

"He seemed to have the support of experienced colleagues we had by our side," said Uhlich, who added that nobody anticipated the severity of the current recession.

Uhlich hadn't had a chance to review all the options Hein had laid out last week, but she said that she wanted a "transparent" budget process. While she didn't address the trash fee directly, Uhlich signaled that higher city fees were on the horizon.

"We will be asking everybody in the community to contribute a fair share toward the city's services," she said.

Hein says a boost in the trash fee is certain to happen eventually.

"It's an enterprise fund, so it certainly has to break even," Hein says. "Whether it's done this year or not, there will have to be a rate increase at some point. ... There will certainly be a cost-of-service study done this year."

If things work out the way that Hein is now proposing, the City Council may not need to embrace too many of the "revenue enhancements" to balance next year's budget. Earlier this week, Hein released a budget plan that only requires $5 million in tax and fee increases.

Hein proposes to bridge the remaining budget gap with a number of other budget maneuvers, including:

• Saving $2 million by merging the city's planning and development services departments.

• Cutting another 7.5 percent from other city departments.

• Requiring city employees, with the exception of police and firefighters, to take 12 unpaid days off.

• Dipping into the city's reserve fund for $4 million.

• Refinancing portions of the city's debt to save $10 million.

• Cutting $4 million in Sun Tran funding.

• Cutting $4 million in funding to outside agencies.

Hein also expects that some commercial property owners neighboring the city will agree to annexation, bringing in an estimated $1 million in tax revenues.

Hein says he'd like to decide which workers will be laid off by April so they'll have a chance to look for new work, make plans to take care of their insurance and take other steps to brace for losing their jobs.

"I'd like to let them know as soon as possible," Hein says. "They can use our insurance through July and get other employment, hopefully."

City Councilman Rodney Glassman said he hadn't yet had a chance to review Hein's memo on fee and tax increases, but he said that the city would probably need to implement some of them.

"I think we need to be honest with the citizens of Tucson, evaluate what things cost and then make a decision about how to pay for them," Glassman said. "We cannot make empty promises about providing services for free, because it's not possible."