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South Valley Journal

Unified Fire increases taxes by 9.56 percent

Jan 31, 2018 01:02PM ● By Mariden Williams

The 9.56 percent tax increase is just enough to allow the UFSA to maintain its required 15 percent minimum reserve. Further information is available at (Unified Fire Service Area)

The Unified Fire Service Area’s 2018 budget includes a 9.56 percent tax increase, unanimously approved by the last Dec. 19. The increased money will ensure that the UFSA can maintain its current AA2 bond rating without slashing fire department services.

According to UFSA District Administrator Ifo Pili, the UFSA—a taxing organization whose entire purpose is to collect funds for the Unified Fire Authority—has danced around a tax increase for the past eight years. During that time, the UFA’s service costs have gone up by around 12–15 percent, even without factoring in inflation.

“We haven’t raised taxes in eight years, despite the fact that the annual costs have gone up 2 to 3 percent annually over those eight years,” Pili told the Riverton City Council last November. “We were able to avoid it thanks to the healthy fund balance that we’ve carried.” Even though UFA services cost more than what the UFSA was bringing in, there was enough money in the stored fund balance to fill in the gap.

But according to Pili, digging into the fund balance to compensate for the lack of revenue just isn’t sustainable any more. The UFSA board has committed to maintain a 15 percent minimum reserve of stored funds. It dipped below that amount in 2017, and, without a tax increase, it will sink even further in the coming years and risks losing its current AA2 bond rating.

“We’re pretty happy with our current bond rating,” said Pili. “If it decreases, we risk costing the taxpayers a lot of money—even more money than will be paid with the tax increase.”

“If that bond rating goes down, first of all, it becomes more difficult to sit there and seek financing, but second of all, if you do get that financing, it’s going to come at a higher rate. It’s just like your FICO score,” said Councilman Sheldon Stewart, who represents Riverton on the UFSA board. “I deal with banking every day, and I deal with people that have impaired credit. It’s my primary source of business, and they pay a much higher interest rate. They almost pay double.” 

One way or another, the UFSA must meet its 15 percent minimum reserve, and if they didn’t increase taxes, they would have to cut services. Since 80 percent of the UFA’s funding goes toward paying personnel, almost all cost reduction would have to be done by laying off staff. The UFA isn’t a big bloated organization; it’s about getting out the door and providing rescue and fire services to those who need them.

“Over this last year, we have really streamlined the administration and pushed a lot of money back into service delivery, where it really matters,” said UFA Assistant Chief Jay Ziolkowksi. “A lot of that funding came by eliminating the upper echelon of the UFA. We want to provide the best service possible, at the lowest cost possible.”

The tax increase is just enough to get the UFSA’s fund balance back to where it needs to be in 2018.

“We’re not trying to create a windfall; we’re not trying to stockpile,” Pili said. “We’re just trying to get back to that 15 percent minimum reserve.”

“If someone’s going to vote me out because I made a tax increase for the right reason, I’m glad I got voted out,” said Councilman Sheldon Stewart. “I’m going to do the right thing, and the right thing is to make sure we maintain that fund balance. You’ve got to make a decision. You can’t operate without a tax increase. It just doesn’t work. That’s not the way this society works.”