Leader Blues

Friday, December 22, 2006

TOP STORY >>Department bails out city

BY JOAN MCCOY
Leader staff writer

The financial crisis in January for the city of Cabot, which is expected to enter the new year with $45,000 or less in the general fund, has been averted by a $240,000 payment from Cabot Water and Wastewater Commission, which now runs the city utilities.

The commission met Wednesday morning and voted to give the money to Eddie Joe Williams, the new mayor on Jan. 2. State law allows water departments to voluntarily pay 5 percent of their annual revenue to the city for fire and police protection. State law also provides for payments to the city in lieu of property tax. In a breakdown of the money the city will receive, about $10,000 is in lieu of taxes and about $230,000 is for fire and police protection.

For many years, water department money has helped the city make it through January. The money was simply transferred from the water department to the general fund.
But in 2006, the new commission, voted to pay the money in quarterly increments instead of a lump sum.

Mayor Stubby Stumbaugh had not been a supporter of turning the city utilities over to a commission. And when the commission was trying in 2005 to get ready to take over running the utilities by January 2006, he insisted that they must go through him to get information they needed. He told commissioners to tell him what they needed and he would get it for them.

Williams has been in contact with the commission since he was elected in November, and both the commission and the mayor-elect say they are looking forward to a good working relationship. Commission secretary Bill Cypert alluded to the city’s cash crunch during the Wednesday morning commission meeting.“The mayor-elect has asked us to make that payment in one lump sum effective Jan. 2,” Cypert said. “In light of the circumstances, I make a motion that we do that.”

Except for brief comments about the importance of working with the city, the commission approved the payment without discussion. Williams did not at-tend the meeting, which lasted about 15 minutes, but he said later that he appreciated the cooperation. “I think it’s great that they see themselves as part of the city and realize that what’s good for the city is good for them,” he said.

Williams also has asked the commission to consider buying the city annex, which now houses the water and sewer billing departments and the old city shop on Kerr Station Road. The city is buying the old Community Bank building next to city hall and doesn’t need all the space at the annex and the money the commission would pay would help with the cash crunch. The old shop could be used to park equipment.

Also, Williams said he doesn’t want the commission to move the headquarters for Cabot Water Works out of the downtown area and leave part of the building vacant. Williams said last week that he hopes it won’t be necessary to ask the commission to pay all the money at one time in 2008.
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The budget Williams is working on for 2007 will call for enough cuts to ensure that at least $300,000 of the expected $7.5 million in revenue will be carried into 2008.