Councilor Zelenka briefs Laurel Hill Valley on the annual $10M fee

Presenter: Tom Bruno told the Neighborhood Leaders Council Feb. 25 that people are calling it the greatest briefing ever given by Councilor Alan Zelenka.

Tom Bruno (Laurel Hill Valley): We had our general meeting and at the very end, Alan Zelenka talked about the fire fee, and it was very, very good. Alan had slides that he presented and everything and people said, ‘That’s probably the best briefing that Alan’s ever given in his 17 years as a councilman.’

[00:00:35] Presenter: At the Laurel Hill Valley general meeting Feb. 19, Councilor Alan Zelenka:

[00:00:40] Councilor Alan Zelenka (Ward 3): I wanted to talk about the fire fee that the city council just passed. We did pass it on a 5-3 vote after almost a year and a half worth of working on it, 25 meetings. We had a citizen revenue advisors group working on it.

[00:00:57] And before I go into that, I want to give you a little bit of background on the budget so you can understand what’s going on with the budget and how it gets built a little bit.

[00:01:06] Our budget is about $650 million and about two-thirds of that are in silos or what I call ‘dedicated funds,’ meaning that the funds are directly dedicated to a type of service. So, like, the passenger fees at the airport can only be used in the airport. The gas tax could only be used to fix roads. So those are dedicated funds that can’t be used anywhere else.

[00:01:32] The other third of the budget is what’s called the general fund. It’s primarily funded by property tax and a little bit of the franchise fees from EWEB and other folks. And that’s about a $200 million budget.

[00:01:48] And that has the general fund services in it. The general fund services are Police and Fire. They make up 60% of the general fund, that’s Police and Fire. And then there’s Planning, Parks and Recreation, Library, and Central Services.

[00:02:05] And when we get a dip in the property tax or we had incredible increases in cost like we just saw recently with inflation, it’s the general fund that takes that hit. [Property taxes are limited by Measure 5 to 3% in a year, so they’re limited in how much they can grow.] And so we’re currently seeing about an $11.5 million shortfall.

[00:02:32] So I’ve been on the Council 18 years. Before that, I was on the Budget Committee for 10 (years). In the last 16 years, the budgets from 2010 to 2025, last 16 years: 13 out of the 16 last budgets have been cut budgets, in the general fund. And that means over $60 million worth of cuts in the general fund over the last 16 years.

[00:03:01] The general fund is an operating budget. It pays for mostly staff and all the services we do. And one of the ways to measure your general fund is how much dollars per capita (per person).

[00:03:13] In the last 16 years, Eugene has basically added a city the size of Springfield into Eugene. So we’ve added that many more people into the city of Eugene, but we still have the same general fund services.

[00:03:26] And in 2008, we had $1,108 per person for the general fund services (Police, Fire, Library, Parks and Recreation, and Planning). And in 2025, it’s $1,018. So it’s been a decline in the amount of money we’re spending in the general fund per capita for these services.

[00:03:47] Presenter: Another measure is the number of full-time employees, or FTE. Councilor Alan Zelenka:

[00:03:53] Councilor Alan Zelenka (Ward 3): And another way to think about the general fund is how many FTE does it take to do the per thousand number of people in the city, which starts in 2008 and goes to 2025. And the general slope of that line is down. In 2008, we had 5.8 people or FTE per thousand persons in the city of Eugene. And in 2025, It’s 4.6 FTE.

[00:04:24] So we’re doing the same services with a lot less employees and it’s been declining over time. The reason I show you these graphs is because I think that there’s a lot of folks that think that the budget has been out of control and it’s ever increasing and I don’t think that’s correct.

[00:04:40] These graphs show and tell you a different story. It tells you a story that I think, which is a good one, which is we’ve been good stewards of your taxpaying dollars in the city of Eugene and providing these services and not having it go out of control.

[00:04:54] So with those $60 million plus that we cut out of the budget over the last 15 years, there’s, all that fat and inefficiency is gone. We’re now into the point where you have to cut out whole services, whole programs out of the budget in order to balance it. And by law, we have to have a balanced budget.

[00:05:16] And so we asked the city manager to come up with a list of cuts that would balance the budget: What things do we need to cut out of the general fund to get $11.5 million? Let me read you this list of cuts for $11.5 million:

[00:05:34] The animal welfare program would go away. Ten sworn officers that are on the traffic safety unit would go away. Crime prevention team, community safety officers would be reduced. The Volunteers In Policing department, CAHOOTS, Fire Department Rescue team would go away, our hazmat team would be reduced. We’d seasonally close one of the fire stations for a half a year and rotate that around.

Kidsports and Boys and Girls Club would get no more support in the city. We would close Amazon Pool. We would close Sheldon and other community centers. We would cut about 150 Park and Rec temporary employees that do the programs during the summer. We would close the library one to two days.

[00:06:21] We would reduce park maintenance. We would cut homelessness services and human services funding. The economic development and business retention services would be greatly reduced and the energy management team would be reduced and the downtown cleanup would be reduced. And then finally, we would eliminate the neighborhood services program, the neighborhood program.

[00:06:42] So that’s a hard list. That’s a lot of stuff. When I looked at lists, I was having a hard time figuring out what the city would look like and what it would be like without these services.  

[00:06:55] And I fully realize that people on fixed incomes and people are living paycheck to paycheck, that increasing fees is a tough choice. So for that, part of the fire fee actually has a chunk of the money going to help pay assistance for some of the lowest income people out of that $11 million.

[00:07:17] So that was the choice that the City Council had to make: that list of cuts or instituting a fire fee and increasing revenue. And the Council voted 5-3 and I was in favor of putting the fire fee in place.

[00:07:33] And what that is is, it’s not a new idea. Eight other cities in Oregon have service fees on the books and have been doing it for years actually. And the fire fee would be on your EWEB bill, an extra charge, and it would be dedicated to fire services and actually increase the Fire budget by a bit and it would be based on the square feet of your building.

[00:07:58] There’s a chart you can see it on our website and it basically says: How big is your building in terms of square feet? So if you had a 750 to 1,500-square-foot home, would be $6 a month; if you had a 1,500 to 2,500-square-foot home, maybe $10 a month, and then it ratchets up. So it’s based on the square footage and service, and it’s related to what the fire fee would actually have to pay for based on square footage.

[00:08:28] [Everybody pays, including the University of Oregon, for every building that they have. We can’t tax the state, but I think we can actually do the fire fee on the state office buildings.]

[00:08:39] And basically the tough choice we had to make was that list of cuts or institute this fire fee, and I chose to go with the fire fee and it was a 5-3 vote. Councilors Clark, Randy Groves, and Greg Evans were against it, the rest of us went for it. I wanted to give you an update of where that came from, where I was coming from, and what the kind of the skinny was on what was really behind all that.

[00:09:04] Presenter: Councilor Zelenka was praised by former state Rep. Phil Barnhart.

[00:09:09] Phil Barnhart: I want to just make a general comment. You have explained this really well. (Thanks.) I spent 12 years as chair of the Revenue Committee in the Oregon House of Representatives trying to fix this property tax issue that you described and I utterly and absolutely failed…  

[00:09:25] And everybody in this room needs to know this: The reality is that every city, every park district, every school has got to find another way of getting income, because the way this property tax rule is structured—which you did a great job explaining in just a few words—the way it’s structured, it will never keep up with inflation and it will never allow us to provide services to new people.

[00:09:53] And it’s not just the city of Eugene, it’s everywhere in the state. So my suggestion to the people in this room is that if this thing does come to a vote, which is a possibility, vote for it even though you don’t want to pay the tax. Because we have to have it or the services that the city provides will slowly disappear.

[00:10:16] And the things that we absolutely have to have, we won’t be able to pay for anymore. And this is not the fault of the City Council. It’s not the fault of the legislature. It’s on Measure 5 and Measure 50 in the ‘90s that we have never been able to repair.

[00:10:30] Presenter: Councilor Zelenka was asked about federal monies, such as the Inflation Reduction Act (or IRA) funding.

[00:10:37] Councilor Alan Zelenka (Ward 3): Basically, the federal monies that we get are mostly project-oriented funds, so they’re what we call capital, so they build the project, or like LTD can buy buses, or we are can buy and build the shelters.

[00:10:50] They almost never give you operational dollars to run things on an ongoing basis. The general fund is entirely operational dollars. So it’s got very little federal dollars in it.

[00:11:06] And so it doesn’t get impacted by the freeze, which is a good thing. But the things that we thought we were going to get are frozen. I’m the assistant director for the Oregon Department of Energy. The state of Oregon was supposed to get a whole bunch of money for programs. That is frozen.

[00:11:21] And about two-thirds of the IRA money that was put together, about two-thirds of that was actually put into contract with the states, from the federal government, by the Biden administration. So there’s contracts. And what the Trump administration has said is, they said, ‘Well, we’re not abrogating contracts. We’re freezing. It’s a temporary freeze.’ And we go, ‘How long is temporary and what does that actually mean?’

[00:11:50] And what’s going to happen is, I think that will go through the court system. And then the judges put a stay on the freeze, but the Trump administration still hasn’t unfrozen stuff. I think that’s going to come to a head, either they’re going to have a constitutional crisis about where the administration thumbs their nose at the courts, and the courts are going to have to react to that. And when they start doing contempt of court violations for secretaries and undersecretaries, then I think they’ll get some movement.

[00:12:18] But it takes some judges with some chutzpah, but I think there’s lots of those. But that’s going to take months. It’s going to take a long time to get through all of that. And we’ll just have to see how that all plays out.

[00:12:32] Presenter: At the Laurel Hill Valley neighborhood association, Eugene city councilor Alan Zelenka explains his support for the annual $10 million city fee.