Editorial: Columbia should responsibly reduce transfers from water, sewer fund

April 14, 2013 

— COLUMBIA CITY manager Teresa Wilson’s proposal to slightly reduce the amount of water and sewer revenue the city will transfer into the general fund in the 2013-14 budget is a step — although a tiny one — in the right direction.

Ms. Wilson has proposed a $250,000 reduction, which would drop the city’s typical $4.5 million transfer to $4.25 million. That’s not very much; we’d like to see a cut in the $500,000 to $750,000 range. But we much prefer Ms. Wilson’s approach than that of City Council, which recently agreed to cap the amount of money that can be transferred from the water and sewer fund at 5 percent of annual income.

That sounds good until you realize that the $4.5 million the city has routinely transferred is less than 5 percent. That leaves the door open for this or a future council to increase the transfer.

That’s a step in the wrong direction. Not only should the council follow Ms. Wilson’s recommendation for next fiscal year, but it should devise a plan to gradually reduce the size of the transfers over the next few years to make more cash available to support the dilapidated water and sewer system. After all, the system is in disrepair in part because of the city’s decades-long practice of redirecting dollars away from the fund to pay for unrelated and — many times — unnecessary spending.

Since 1999, the council has transferred more than $80 million into the general fund to pay for things such as police officers’ salaries, garbage pickup and fire station operations. The council also has raided the account to fund pet projects and community organizations.

Meanwhile, needed improvements and maintenance to the system were put on hold. Now, with many water and sewer lines more than 50 years old, the city must make hundreds of millions of dollars in improvements. Water and sewer customers will endure a series of rate increases to help pay for those upgrades.

While even ending the transfers wouldn’t eliminate the need to increase rates, it could reduce the blow to customers and send the message that the city isn’t simply out to soak customers. More importantly, it would be an acknowledgement that maintaining the water and sewer system is a priority.

Stopping the transfers all at once would require a sizable tax increase or sharp service cuts. But that doesn’t justify the status quo. That’s why officials need to develop a responsible plan to wean the city off these transfers.

Columbia officials argue that city taxpayers own the water and sewer system and deserve to benefit from its operation. Frankly, we don’t have a problem with a reasonable amount of the money being used for legitimate city operations. But first things first: Water and sewer needs must be the priority. It’s hard to justify continuous multi-million-dollar transfers when the system is dilapidated, the federal government is demanding improvements, the city is borrowing hundreds of millions of dollars to make repairs and customers’ rates are rising.

What responsible governing body would feel comfortable continuing to tap that source when every dime possible is obviously needed to keep the system operating?

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