PORT ANGELES — The city of Port Angeles has adopted a $130 million budget for next year, its largest yet.
The size of the financial plan, about $20 million larger than the amended 2011 budget, is mainly because of the convergence of several large capital projects, including sewage overflow elimination, waterfront redevelopment and the continuation of its advanced metering program.
The budget also includes no increase to the city’s regular property tax levy — which has remained the same since 2010 — no new staff positions, a reduction in hours for seasonal employees and no cost-of-living increases for staff.
The vote by the City Council on Tuesday wasn’t unanimous.
But it wasn’t the size of the budget that prompted an objection from City Councilman Max Mania.
Nippon waiver
Mania, the lone dissenting vote in the 5-1 decision, cited the city’s continued waiver of the electrical base rate for Nippon Paper Industries USA as the reason for his decision.
City Councilwoman Brooke Nelson was absent due to giving birth last weekend, Mayor Dan Di Guilio said.
The waiver is estimated to cost the city about $36,000 a year.
The council had waived the fee since mid-2004 to help the mill at the base of Ediz Hook stay on its feet.
It agreed during this year’s budget discussions to continue to waive it for the same reason.
Mania questioned whether the mill, which is investing $71 million in a biomass energy project, is in such dire straits to justify the move.
“I understand our need to address a lot of our infrastructure and our capital projects,” he said of the overall budget, “but I guess, when it comes right down to it, there’s a moral component to this.”
Mania, after citing the mill’s biomass project, added, “Yet everyone seems to be concerned about the poverty of Nippon and willing to pass off their rates on everyone else.”
Would prompt cuts
Mill manager Harold Norlund in an interview said paying a base rate wouldn’t be the end of the paper producer in Port Angeles but added that any new expenses have to be offset by cuts elsewhere, including personnel.
“I have to cut costs here,” he said. “Usually it is labor, salary or hourly” that take the hit.
The budget includes the use of $15.4 million in reserves, which is about twice as much as the amended 2011 budget.
City Manager Kent Myers said he expects the 2013 budget to be smaller as long as the city can make the progress it anticipates on the capital projects, some of which were delayed this year.
Some of the large expenditures the city will make next year include: $3.5 million on constructing an esplanade west of the ferry terminal, about $10 million on starting construction of its sewage overflow elimination project and $4.2 million on converting to automated meters.
The esplanade will be paid for with about $2.5 million from the economic development fund and another $1 million split from the general fund and the city’s share of a new grant for The Gateway transit center.
The sewage project, estimated at $40 million, will begin downtown next year with the city inserting new sewage pipes through its industrial water line, which follows the Olympic Discovery Trail.
The North Olympic Discovery Marathon won’t be impacted next year.
The pipes will connect with a large tank on the former Rayonier mill site that will be used to store untreated effluent during heavy rainfall in order to avoid overflows of sewage into Port Angeles Harbor.
The project, mandated by the state Department of Ecology under state and federal clean water laws, is being paid for by a monthly wastewater fee and low-interest state loans.
The funds for automated meters, covered by bonds and grants, will be used to complete replacement of the city’s analog devices with the new electronic versions.
They allow utility bills to be read remotely and residents to control their energy use through a voluntary program called “demand response.”
It allows certain appliances, such as water heaters, to be turned off during periods of high energy use.
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Reporter Tom Callis can be reached at 360-417-3532 or at tom.callis@peninsuladailynews.com.