0

Porterdale may get breathing room for 2009 budget

PORTERDALE - Mayor Bobby Hamby outlined a plan at Monday night's City Council meeting that could relieve some financial pressure for the city in the upcoming 2009 budget.

The council voted unanimously to authorize City Attorney Tim Chambers to draw up a contract under which the city would sell a portion of its reserve sewage treatment capacity to the Newton County Water and Sewerage Authority. The sale would net the city approximately $152,000 - funds that would likely be earmarked for the city's payments on two low-interest loans to the Georgia Environmental Facilities Authority.

Those GEFA loans - one of which was taken out by Newton County in 1993 on behalf of Porterdale - were used to fund water projects for the town. Porterdale makes quarterly payments of $39,300 to Newton County and monthly payments of $10,118 to GEFA for the second loan. Porterdale's total annual commitment for the GEFA loans is $278,616. According to Newton County and GEFA, Porterdale is current on both loans.

Under the plan proposed by Hamby, Porterdale would sell 50,000 gallons per day of excess treatment capacity in the wastewater treatment plant to the Water and Sewerage Authority for $8 per gallon, which would generate $400,000 in total revenue. However, Hamby said the city currently owes the authority approximately $111,000 for 11 months of back payments for the town's share of operating costs for the land application sewage treatment facility and another $25,875 for its share of a project to replace a water line on the Yellow River bridge. In addition, Hamby said the authority is stipulating that Porterdale pay its operating and maintenance costs of $111,000 for the land application facility for 2009 in advance. That leaves the city with a net total of about $152,000 from the sale of its reserve treatment capacity.

"I think it's a good deal; we just need to verify the figures," Hamby said Monday night.

The extra revenue will help the town meet its obligations in what is expected to be a tough budget year. City Manager Tom Fox has said that he anticipates a $200,000 budget shortfall for Porterdale in 2009. Hamby said the revenue from the sale of the sewage treatment capacity will free up the city's general fund revenue for other expenses.

If the sale is completed, Hamby said Porterdale will still have about 200,000 gpd of reserve sewage treatment capacity to accommodate future growth.

Mike Hopkins, director of the Water and Sewerage Authority, said the purchase of part of Porterdale's reserve capacity will also benefit the water department.

"It hopefully will offset by several months to a little over a year an upgrade to our plant," Hopkins said.

In addition, Hopkins said the $8 per gallon that the authority is paying is less than it would cost to build a new plant.

"A new plant right now, we are looking at probably about four to five dollars more per gallon that we would pay for that capacity," he said.

In other budget news, Councilwoman Linda Finger proposed a spending freeze for the city that would apply to all expenditures that are not mandatory.

Finger suggested that the council freeze all discretionary spending for a period of six months and review the policy at the end of that period.

"I'm not saying that anyone is doing anything wrong; I'm just saying we need to get a grip on it," Finger said.

Finger singled out an expenditure of $350 for window blinds in May and $3,400 spent for cell phones since May as examples of spending that could be curtailed.

Finger also said she wanted to stipulate that no more funds be transferred from the Culture and Recreation Fund to the general fund. She was referring to the insurance settlement funds paid after the town's historic gym burned in 2005. So far, about $136,000 from that fund has been transferred to the general fund.

After some discussion, the council voted to have a list of mandatory spending items drawn up in time to enact a spending freeze at next month's meeting.

Alice Queen can be reached at alice.queen@rockdalecitizen.com.