Fiscal Year 2022 - 2023 Upcoming Budget & Fee Increases

Overview

For a number of months, staff and the City Council have been working hard preparing for the upcoming year's City Budget. The following goals were set as staff and Council prepared the upcoming City budget: minimize impact to residents, maintain level of service in core services, not take on additional debt, keep the City fiscally sustainable, keep Utility Funds self-sufficient, and ensure the City isn't spending one-time monies on on-going expenses. 

Ultimately, Highland City has seen significant cost increases due to inflation, especially our utility departments as well as wage and staffing pressures with public safety. To fund these increases, City Council voted to increase the public safety fee as well as utility rates. The reasons for these increases are outlined below.

Police Wages

Due to a variety of reasons including negative public perception and low wages, the pool of qualified applicants for police officer positions has shrunk. In addition, other surrounding departments have been increasing wages to try and retain their officers and as such have been successful in recruiting away our officers. To try and better recruit and retain qualified police officers, Lone Peak Police raised police officer's starting wages $4 per hour as well as adding a step tiered program for qualified officers. 

Fire Staffing

Over the past 5 years, there has been a 26% increase in call volume for the Fire Department. In response, the department is shifting one part-time firefighter position to a full-time position for a total of 6 full-time firefighters and 2 part-time firefighters. In addition to allowing the Department to keep up with the demand in call volume, this also provides the benefit of increased crew continuity, staffing stability, ability to respond to two calls at once, budget savings due to less overtime and less firefighting gear, revenue increase due to additional ambulance transports, better coverage during deployments, and better ability to respond to a major catastrophe. 

Garbage

Due to inflation in labor costs, fuel, and component parts for garbage trucks and cans, Highland City is seeing a $1 per ton increase from Northpointe Transfer station and a 11.1% increase in our rates with Waste Management. The only revenue that goes to pay for garbage service comes from can rates. If rates were not increased, the City would have been charging less than each can costs to service. 

Utility Rates

Our utility funds (water, sewer, storm drain, and pressurized irrigation) are completely cash funded and have no debt. To be fiscally responsible, Highland City projects out the maintenance and reconstruction project costs in each of our utility funds  to ensure the funds will have enough cash to complete the needed projects in those funds. When this last study was completed, the estimated project costs over the next 5 years grew a total of $7 million dollars. If rates were not increased and projects needed to maintain the current level of service were completed, those funds would have shortly run out of money. 


Impact to Residents

To fund the needed increases listed above, City Council ultimately voted to increase the public safety fee as well as utility rates. While the increase to each home is dependent on what services the City provides, the size of the lot, and how much water each home uses, you can see a breakdown of the monthly increases below. Please note, this list only includes the base rates and do not include usage or lot size rates for water, sewer, and PI. 

FeeCurrent RateProposed RateDifference
Public Safety$11.50$15.25$3.75
First Garbage Can$9.61$10.75$1.14
Second Garbage Can$6.76$7.49$0.73
Recycling$6.27$7.18$0.91
Water Base*$15.91$23.07$7.16
Storm Drain$6.97$9.76$2.79
Sewer Base*$5.11$7.15$2.04
PI Base**$20.12$24.14$4.02




Total$82.25$104.79$22.54


*In addition to the base charges for water and sewer, a water usage rate also applies. See the Utility Rate page for details.

** In addition to the base charges for PI, a square footage rate also applies. See the Utility Rate page for details. 


Other Considerations

Council and staff discussed a number of other alternatives in addition to raising fees. Below are an outline of those discussions and frequently asked questions. 

Why can't the City wait to implement the rate increases?

If public safety didn't implement the wage and staffing adjustments, we would likely continue to stay understaffed and continue to loose officers to other organizations. If garbage rates weren't adjusted, the City would have had to cut other services to pay for the $130,000 subsidy in the garbage department. If utility rates weren't increased, projects would have had to be delayed to keep the funds from going in the hole which would have meant a decrease in the level of service. In addition, the City would have limited funds in case of emergency. 

Why can't the City absorb the increases?

The City is already budgeting to absorb $453,000 of the total $665,000 increase in public safety costs. This is coming from the expected increase in property and sales tax revenues. Absorbing more would mean pulling money away from other departments in the General Fund. In terms of Utility Funds, the goal has been for those funds to be self- sufficient meaning revenues from those services pay for the expenses rather than them having to be subsidized by other sources.

Why can't the City use reserves?

As the costs increases in public safety and utilities are ongoing, that would mean using one-time money to pay for ongoing staff costs. Continuing on this path would mean depleting the City's savings accounts which would mean it wouldn't have the money to respond to emergency situations or unplanned project overages. 

What has the City done to reduce spending?

Besides the increases outlined above, the remainder of the City budget is largely flat and the City is doing it's best to absorb inflationary increases in noncore services. In addition, the City has either cut back or delayed a number of projects including: the original public safety proposal, General Plan update, Country Club sewer project, cemetery equipment purchase, playground equipment replacement, tree replacement, building maintenance, fleet replacement, improvements to open space maintenance, and others. 

What if this inflation is just temporary?

It is very likely some of the inflation we are seeing is temporary and has to do with the supply chain. However, industry experts do feel that it will take some time for the supply chain to catch up especially as COVID continues to surge in places such as China. That being said, contracts, projects, budgets, and plans are regularly reviewed in utility funds. As such, if costs in those funds begin to drop, rates can also decrease. 

Why can't economic development pay for the increase?

While Highland is expecting to see some increase in sales tax due to new businesses coming in, spending in Highland would have to increase between 35 and 50% to make up for the $310,000 unfunded increase in public safety. Further, businesses take awhile to build and be successful and the funding needs exist today. 

Why is the City still planning on building Mountain Ridge Park?

The money budgeted for Mountain Ridge Park comes from a variety of sources most of which are one-time revenues and/or restricted funds that can only be spent on parks. Being restricted means it legally can not be spent on public safety salaries or in utility funds. 

What about individuals on fixed incomes? 

The City recognizes that this increase may negatively impact some more than others. To provide help for those who need it, the City is currently exploring options including becoming a HEAT program partner to assist individuals with low-incomes on their utility bill payments. 


Public Meetings

Below are the, agendas, videos, and presentation materials from the Council meetings where the budget was been discussed.