To pay for police station, council settles on seasonal sales tax

Apr 13, 2018

Credit Image Courtesy of the City of Homer

The Homer City Council is close to finalizing its proposal for a new $7.5 million police station. On Thursday, it came to a consensus on how it will ask the public to pay for $5 million of the project and how complete of a design it will present before Homer residents vote on a bond measure this fall.

The council unanimously agreed to pay for a survey of the site that would map out utilities, sample for hazardous material and determine soil composition.

Public Works Director Carrey Meyer told the council he expects the site to be suitable for the new station.

“I’m not expecting anything, and everything we know about that site doesn’t indicate that there’s any kind of a problem,” Meyer explained.

But the council did disagree on whether to present its proposal to the public with 10 percent or 35 percent of the design completed. A 35-percent design may come with some visual renderings of the building and would cost about $250,000.

Council member Heath Smith argued that a more complete design would help the bond measure pass in October.

“Failure is not an option here. I think that if we have a product that the public can sink their teeth into, we put ourselves in a better position to defend the expenditure of the money,” Smith said.

Council member Tom Stroozas pushed back, saying that voters need to approve the bond before the city spends too much money on the project. The council agreed move forward with a 10-percent design, although that could change once the council is presented with a formal ordinance.  

The council also chose to ask voters to approve a seasonal 1-percent sales tax to pay for the 20-year bond. The tax mirrors the borough’s seasonal tax on non-prepared foods in June, July and August.

It’s estimated to bring in just under $600,000 during those three months. Bond payments would be just under $400,000 annually, but maintenance costs for the new building are expected to run $81,000 or more per year.

Some council members disagreed about whether to sunset the tax completely when the bond is paid off or to maintain .2 percent to pay for increased maintenance costs.

“We spent almost $1 million on the fire hall, which was all probably deferred maintenance. You look at our current police station and the state it’s in,” Smith said. “It has not been taken care of over time. We have to have the money to take care of the buildings, period. I’m not interested in building things that we will not take care of. It’s a waste of money.”

Council members Shelly Erikson and Stroozas opposed keeping part of the tax on the books. Stroozas argued the city would save money by not having to maintain the current police station and that something will be done with the underused Homer Education and Recreation Complex to save the city money.

“The $45,000 to $50,000 we spend there, we’re going to be saving that as well. So, those two figures should be able to cover this $81,000,” Stroozas said.

The council did eventually agree on keeping some of the tax to pay for O&M costs. The council is not able to make official decisions during work sessions, but City Manager Koester told members she would come back to the council with ordinances it could take formal action on.