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Woods Cross cautious in its budgeting

WOODS CROSS -- The specter of a possible economic downturn in the next 12 months has the city administration feeling cautious as budget time approaches in this "pay-as-you-go" city.

However, two controversial projects -- a downtown development and a proposed annexation -- have the potential for cementing the city's financial foundation for many years to come.The tentative budget for 1999-2000 totals $4,342,000, 11.4 percent over the current year. It will be aired at a public hearing 7:30 p.m. Tuesday at City Hall, 1555 S. 800 West.

Except for a possible 50-cent-a-month increase in garbage collection, next fiscal year's budget would have little impact on residents' pockets.

Some council members have been hesitating about the proposed garbage increase based on expectations Wasatch Energy Systems could offer a rate reduction later this year. However, "there is no question we need to balance revenue and expenditures," said City Manager Gary Uresk. "If the burn plant doesn't offer a rate decrease, we'll have a big hole in our budget."

Spending on streets would drop by 5 percent but would still constitute the second largest budget item at $357,545. This would pay for several street improvement projects not yet identified and some roadside beautification.

Spending on storm drains would increase by 34.8 percent to $160,870.

Although no additional police positions would be created, the purchase of vehicles, protective vests and 800-megahertz radios would boost the police budget by 8.2 percent, from $839,435 to $907,900.

Vehicle purchases are also contemplated for the city manager, public works director and parks supervisor.

Raises for city employees averaging 4 percent are being proposed, and $75,000 to refurbish City Hall.

In his budget message to elected officials, Uresk sounded a warning about the lack of growth in property taxes since 1997 at the same time that demand for services by new developments has been increasing. Since 1995, the city has approved five subdivisions with a potential for a total of 383 homes.

"This increased demand for services is presently being met by increases in sales tax receipts. However, if the economy falters, services in the city will need to be cut back or the property tax rate increased," said Uresk.

He said he had been conservative in projecting sales tax receipts in the coming fiscal year "to create a buffer against any downturn in the economy that may possibly occur."

According to the Utah State Tax Commission, Woods Cross' sales tax receipts were down 9.2 percent in the fourth quarter of 1998 compared to the fourth quarter of 1997.

A pending item that could significantly affect the city's finances for a long time is what will happen to the old salvage yard property across the street from city hall, on which a Town Center, a mixed-use residential/commercial development, is contemplated.

If the city concludes a deal for the sale and development of the parcel, it will recoup $300,000 spent to acquire the property and obtain a significant source of additional sales and property tax revenue. Failure to develop the property could cost the city many hundreds of thousands of dollars in lost revenue.

Another pending item with an even larger potential impact on city finances is the Smith Farm annexation. The 112-acre farm northwest of Redwood Road and 500 South is located where a proposed Legacy Parkway interchange would go. Commercial development of the property could eventually generate as much as a quarter of a million dollars in taxes a year.

Under heavy pressure from West Bountiful, which wants the property, the Woods Cross council recently rejected a request by the owners to have Woods Cross annex the property. However, the owners say they will ask the council to reconsider the matter.