Former Basalt town manager Scanlon says he shouldn’t be council’s scapegoat for budget
The majority of Basalt Town Council members indicated Tuesday they support certifying a property tax that was approved by voters in 2013 but only partially implemented.
The town issued bonds in 2013 and 2014 as part of its “Fix the Fork” initiative. The project included easing flood risk of the Roaring Fork River, relocating residents and removing trailers at the former Pan and Fork Mobile Home Park, and performing grading and installing infrastructure on a portion of the trailer park that is privately owned.
Bonds were issued and a property tax implemented for the work on public lands. The town government assumed it would recoup the funds spent on the private property when the parcel was developed. Therefore, it never levied a property tax to pay for $2.5 million worth of work, according to Finance Director and Assistant Town Manager Judi Tippetts.
Those bonds are being repaid instead through the town’s open space sales tax. It would require about $351,000 annually through 2023 from the open space revenues to pay off the bonds.
By certifying the full mill levy approved by voters in 2013, repayment would shift to a property tax and open space funds would be preserved for additional projects, according to town officials.
The decision would amount to an extra $15 per month to the property tax bill of a house valued at $500,000.
Some members of the Basalt Town Council have contended over the past two weeks that ex-Town Manager Mike Scanlon is partially to blame for the austerity budget required for 2017.
But Scanlon, back in Basalt on business this week, responded Wednesday that he shouldn’t be the scapegoat. The council was on board with his proposed budgets in prior years and the philosophy behind them, he said. Now they are veering from the path.
Scanlon quit in August after financial issues and oversight came to a head with some members of the council. Negotiations between the two sides have gone nowhere and litigation appears imminent. Scanlon returned to the Kansas City area, but he is back in the midvalley this week consulting for property owner Ace Lane.
Throughout budget work sessions this fall, including Tuesday night, Councilman Bernie Grauer has contended that Scanlon failed to produce a five-year capital improvement plan despite Grauer’s repeated requests for it. That’s essential for the council, he said, because it impacts funds available for the operating budget.
“We can’t do our job without that information,” Grauer said at a Nov. 9 meeting.
He said he requested the capital improvement plan from Scanlon for 18 months without success. “I will take some responsibility for not forcing the issue,” he said.
Mayor: Council too trusting
Mayor Jacque Whitsitt said prior councils went along with Scanlon’s fiscal proposals because he assured them the town had the financial wherewithal.
“We were always giving head nods,” she said Nov. 9. Therefore, the board was too “spendy,” she said.
Several members of the council also lamented that too many financial pledges were made in the past that hamstrung the current council when planning the 2017 budget.
Councilwoman Katie Schwoerer, who was elected earlier this year, said a commitment to contribute $500,000 in 2016 and 2017 to Willits Town Center for affordable housing is eating into the town’s discretionary funds. As a result, contributions to child care and the bicycle-share program will be reduced under the 2017 proposal, she said.
The town is preparing to make $1.3 million in cuts and adjustments to revenue to produce a balanced budget and restore a 33 percent reserve for its operations.
Whitsitt and Grauer said the town dipped into reserves under Scanlon’s leadership. Whitsitt said the town reserve was reduced to two months at one point without the council’s knowledge.
Scanlon: Council knew
Scanlon said Wednesday that Roaring Fork River improvements undertaken in 2014 and the pedestrian underpass currently being constructed are consuming the vast majority of the town’s capital improvement funds for several years. Prior councils understood the town would have to forgo any other capital improvement projects for some time to absorb the projects.
“Those projects were voted on multiple times by the council,” he said.
The direction set with the council was to maintain road maintenance for a few years without undertaking massive projects, he added.
When contacted by The Aspen Times, Scanlon produced a five-year financial forecast he produced for the council in 2015. He noted that forecast acknowledged that reserves were being drawn down to achieve major goals. His plan called for the reserve to be rebuilt over time.
The council has changed that direction and now wants the reserve replenished in one year, he said.
The council is poised to approve a budget in December that includes $7.27 million in unrestricted expenditures — items the town can control.
The town initially planned to reduce child care contributions from $75,000 to $45,000. Much of that money goes directly to scholarships to make child care more affordable for Basalt families.
The council was urged Tuesday by parents and child care providers not to reduce that funding. The council majority indicated they would support restoring another $12,500 to the child care fund, boosting it to $57,500.
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