(a) Should members of a car pool split gasoline costs while the driver foots the entire bill for operating costs?Or, (b) Should car pool members be expected to split the entire cost of operating the vehicle?
In addition to number pushing, the Salt Lake City Council is wrestling with this philosophical question in 11th-hour budget deliberations.
Cam Caldwell, the councils' budget analyst, recommends that the city's enterprise funds pay the costs of receiving city services, such as police and fire protection. Extending the car pool analogy, that means the parks departments and the Salt Lake International Airport, as members of the municipal car pool, would be splitting up the entire cost of operating the city vehicle.
For the taxpayer, the difference is slight. It comes down to whether services are paid directly by users, such as golfers who pay green fees, or indirectly by all city residents through property or sales taxes.
The City Council adopts a budget June 9. Calling for no property tax or fee increases, Mayor Palmer DePaulos recommended an $80.3 million general fund budget, which is 1.5 percent below last year's adopted budget.
After a grueling, monthlong budget process, council members are desperately looking to make cuts in DePaulis' budget, in order to restore the police department's crime prevention and crime analysis programs. Other council additions include the fire prevention and pet ownership education programs.
In addition, Councilman Alan Hardman wants to find $1.6 million of cuts to eliminate the $4 monthly garbage fee. Willie Stoler wants $600,000 to give employees merit raises, and Roselyn Kirk wants $325,000 to keep an east-side fire station open until a new, consolidated station is built.
In principle, a miunicipal enterprise fund is set up to operate as a business, and fees are charged to pay for the services provided. The city has five enterprise funds: garbage, water, sewer, golf and airport.
Other city services, funded by tax revenues, are paid for out of the city's general fund.
There are just a few hitches to the charge-for-services concept, which according to Caldwell's figures, could free up some $264,000 this budget year, and would help recover costs for public safety services, which absorb the largest percentage of the city's budget.
City administrators say that while they approve of the enterprise charges in concept, they can't reach an agreement with council staff over a formula for accurate cost allocation, Lance Bateman, city finance director, said state law mandates that enterprise funds can't be arbitrarily assessed fees, without holding a public hearing and notifying all ratepayers. If a mailing to the city's water and sewer customers becomes necessary, it could cost up to $40,000.
"This could be an area where we just have a difference of opinion. It has significant implications," said Mike Zuhl, chief of staff for DePaulis.
City Attorney Roger Cutler has been asked to consider the legal question. But Council Executive Director Linda Hamilton said the council will consider consulting an independent attorney, depending on Cutler's response.
Another snag to the plan is the threat that airport lessors might file a lawsuit against the city, if addional fees are tacked onto their contracts, said Airport Director Lou Miller. If airlines paid fees for city services at the Salt Lake airport, other airports might follow suit, and that would be an unwelcome precedent for company officials.
"Is this good policy? Would we be doing it if we weren't desperate for money?" asked Councilwoman Sydney Fonnesbeck. "Why haven't we charged before?"
Caldwell said hundreds of cities levy charges for services to their enterprise funds. "Staff recommends it because it is good policy. Staff recommends it because it treats the enterprise funds as businesses."