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County Commission and Freeport Council discuss sewer loan and fire services at workshop

Aug 23rd, 2013 | 0

By REID TUCKER

No deals were struck, the joint meeting of the Walton County Board of County Commissioners (BCC) and the Freeport City Council being a workshop, but at least both parties know where they stand on two big money issues.

The commissioners and the Council members met Aug. 19 to hash out their positions on potential options for resolving Freeport’s outstanding debt on a loan for updating its bay area sewer system and they also to took on the somewhat touchy topic of the city’s firefighting services.

Freeport borrowed what added up to be in excess of $2.6 million to expand its sewer system along Bay Grove Road, and, after paying back $339,000 toward the loan (at a 3.09 percent interest rate) the city owes approximately $2.3 million. However, a scarcity of new taps into the system, particularly along the waterfront, has turned making interest payments to the county and paying off the principal, into a mounting problem. On top of those worries, the heavy and constant rainfall of recent weeks caused residents’ septic systems to overflow into the Choctawhatchee Bay, which has become increasingly contaminated with bacteria.

Two main proposals emerged from the City Council, with Mayor Russ Barley’s plan gaining the most traction among members of both boards. Barley’s proposal was multi-faceted: Freeport would make a $1 million payment to the county, and then invoke the county’s offer to forgive $400,000 to bring the balance to $900,000. The interest rate on the remaining debt would then be set at 0 percent, after which the city would pay the county $180,000 per year for a five-year period.

Commissioner Bill Imfeld threw his support behind Barley’s plan, saying that he will make a recommendation to the rest of the board at its meeting next week to accept the offer. He said the prospective solution achieves three things: the county gets a good deal of money up front, Freeport gets some flexibility and the residents of the city will in all likelihood be looking at lower hookup costs, incentivizing utilization of the sewer system.

However, Councilman Ray Jackson raised a few points of contention with the plan, explaining that the city would technically need to bring on 500 new sewer customers every month if the average $30 monthly bill for sewer services was to pay back $180,000 per year. Furthermore, Jackson contended that Barley’s plan, while it would help the county and the city make progress on the financial side, does little to reduce contamination in the bay. He said residents are unlikely to give up their septic systems until their toilets no longer flush, given that the total cost of a new sewer hookup comes in at $6,000.

Jackson’s idea was for Freeport to spend its $1 million in providing free, but mandatory, sewer hookups to bayside residents. He also wanted to see the city, county and state look into using grants as part of a concerted effort to clean up the bay, which he said was the primary reason behind installing the sewer system in the first place. However, the attorneys of the board and Council took issue with Jackson’s plan, saying that such a move could prove problematic as the residents who already paid to hook up to the sewer would likely want a refund, not to mention that the county would still be out the majority of the debt still owed by the city.

Having wrapped up discussion about the sewer system debt, the commissioners and Council members switched gears and focused on options regarding fire services east and west of Freeport along SR-20. The Council proposed that the Freeport Fire Department remain independent and continue to provide firefighting services to the city and also to areas outside the city limits, where a reported 52 percent of all its calls take place.

Under the Council’s proposal, the county would pay in $75,000 and the city $300,000 toward the department’s operating costs. However, based on the figures presented at the workshop, the commission’s three proposed options will all cost the county less than that, and one, if implemented, could actually generate $470,000 in revenues and costs eliminated.

All three proposed options take into account the recently increased fire services assessment fees. Freeport residents had their assessed payments increase from $25 to $75 per year for fire services, generating a total of $111,000 from the city, while the county assessment generates another $210,000.

The first option would see the county construct two new stations east and west of Freeport at an operational cost of $255,000 apiece, though revenues from the increased assessed fire service fees means the county would be $40,000 short of balancing out. Alternatively, the second option involves for the construction of a new station to the east while the county takes over operation of the Freeport Fire Department, thereby eliminating the need for the $260,000 paid to the city each year to provide fire services to the nearby unincorporated areas. Operational costs associated with taking over the fire department come to $605,000, but with about $580,000 in costs eliminated (plus a lesser burden on Freeport residents, who would no longer be responsible for $311,000 in ad valorem taxes), the county would need just $24,000 to achieve a balanced budget.

The third option is, in the words of Imfeld, the most appealing to the county, as it actually makes about $215,000 for the county. This plan involves the construction of a new station to the east of Freeport and the relocation of the county’s Choctaw Beach station, which has fallen into disrepair, further to the east to cover Freeport and the outlying area to the west. This involves no new personnel costs and no new additional operational costs outside of the $255,000 needed for the new east station, while also eliminating the $260,000 payment to Freeport, and includes the $210,000 from the fire assessment.

The BCC and Freeport City Council will include further discussion on these topics at their upcoming meetings.

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