10:47 PM PDT on Sunday, April 25, 2010

The Press-Enterprise

The city of Colton faces an uphill battle in November if it asks voters to extend a utility user tax in order to fill a $5 million hole in its budget for the coming year.

“I say no,” resident Linda Tripp told the City Council this week. “The citizens of Colton have been used and used and used … Rates are too high. Businesses are closing. People are losing their jobs.”

Tripp and several other residents urged the council to make a choice between the utility tax and two electric rate hikes approved last year totaling more than 17 percent.

“You want the UUT?” she asked. “Take back what you raised on the electric rates.”

Colton businessman Gary Grossich said “We cannot afford both. If you think people are screaming now, wait until the summer months when the full impact of the second half of the rate increase comes in.”

City Manager Rod Foster said he will present the council with two budgets on June 1. One will be based on the continuance of the utility tax and the other will contain $5 million in cuts to make up for the lost revenue if the tax is allowed to expire in 2011.

Since the tax was first imposed six years ago, residential customers have been paying a 4 percent surcharge on their electricity bills and commercial and industrial customers pay 6 percent.

Noting that the city has already made $11 million in cuts over the past two years, Foster warned “The only places left to cut are the places you know, and those are going to impact public services and public safety.”

Foster said the city cannot win passage of the utility tax extension by threatening to cut jobs. He said he would “demonstrate fiscal stewardship” by presenting balanced budget proposals.

He also responded to complaints that the need for the utility tax is lessened by the electricity rate increases.

“To me they are completely separate structures,” he said at the meeting. “Utility rates support the electric utility. The Utility User’s Tax is a general tax that funds the general fund,” which pays for most day-to-day city operations.

“I believe we will be able to demonstrate quite efficiently and quite effectively what people will be able to receive and what they won’t be able to receive” based on the outcome of a potential ballot measure on the tax, Foster said.

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