City to collect excise tax for schools

New construction levy to fund new school facilities

By Sean C. Morgan
Lebanon Local

The Lebanon City Council earlier this month agreed to enter into an agreement with Lebanon Community Schools to collect the School District’s new construction excise tax beginning July 1.
The School Board voted last month to impose an excise tax of $1.25 per square foot on new construction to help pay for capital costs associated with growth in the community. The district is projecting minimum revenue of close to $200,000.
The council approved the agreement during its regular meeting held on April 8. The council met using Zoom, a video conferencing application.
Under the agreement, the city will collect a 4-percent administration fee for the collection, recording and reporting of data required by the agreement. The city will provide quarterly reports on the aggregate amount of excise taxes paid, the amount retained by the city and a list or copies of forms for all persons who may be given an exemption from paying the tax.
The state legislature passed a law in 2016 that allows school districts to collect taxes to help pay costs for facilities related to growth in their communities. The maximum tax allowed this year is $1.35 per square foot. If school boards choose, the tax rate may increase slightly each year.
The Lebanon School Board voted March 12 to enact a construction excise tax of $1.25 per square foot on new construction to help pay for costs associated with growth in the community.
School District Business Director Will Lewis told the council in March that the district is projecting tax revenue of more than $200,000 at the maximum rate.
Revenue from the tax must be used for capital projects, Lewis said. It may be used to acquire land; construct, reconstruct or improve school facilities; acquire or install equipment, furnishings and other tangible property; and to pay capital improvement debt.
The tax money cannot be used for operating costs or routine maintenance, he said.
City Community Development Director Kelly Hart told the council on April 8 that school districts must enter into an intergovernmental agreement with a local agency to collect the tax, and the City of Lebanon make sense because the city operates the building program in Lebanon.
The agreement does not mean the council agrees with the tax, Hart said. “We are agreeing to be the administrator of it.”
Four percent is the maximum administrative fee allowed, he/she said. Other cities have imposed lower administrative fees, but they have had problems recouping their costs.
“I understand that it’s just something that they are allowed to do,” said Councilor Karin Stauder. “I just wanted our community to know this is not an extra tax that we are doing (but) is solely on the School District.
“Our only involvement, which does make sense, is that we are kind of that go-between since we collect the permits anyway and then to be able to peel off the money that goes to them.
“My own opinion is that if you want a capital improvement, you go out for a levy for that. But anyway, that’s a whole different story. It doesn’t matter what my opinion is, but I just wanted the public to understand that it is definitely not something that we the city are deciding to charge an extra tax on new construction in our community.”
Present at the council meeting were Wayne Rieskamp, Rebecca Grizzle, Michelle Steinhebel, Mayor Paul Aziz, Jason Bolen and Stauder. Robert Furlow had technical difficulties logging into Zoom and entered the meeting later.
The meeting was open to members of the public to tune in, and Aziz offered time for public comments during the meeting.
In other business, the council:
♦ Authorized interim City Manager Ron Whitlach to sign a quote for a new vactor truck.
The current vactor truck is a 2007 model, he said. Typical lifespans are eight to 10 years, based on use.
The truck is used daily to clean and unplug sewers as well as in small and large excavations, Whitlach said.
“The city’s current vactor truck is spending a fair amount of time in the shop for repairs, mostly related to the high use and age,” Whitlach said. “Staff is proposing to begin the process of having a new one built in order to have it by late summer (or) fall of 2020.”
The manufacturer requested that a city representative sign a quote for $452,000 before beginning to build the truck, he said.
The city committed funds for the new truck this fiscal year, 2019-20, which ends on June 30. While budgeting this year, the city estimated the cost at up to $600,000. The funds will be carried over to next fiscal year, 2020-21.
The city will purchase the truck from Vactor/Guzzler Manufacturing through Sourcewell, a purchasing site used by state and local agencies to procure goods and equipment without going through a formal request for proposals. Whitlach said that a discount has been applied to the purchase.
♦ Heard from Whitlach that staff members are preparing “a very conservative budget that does not have a lot of projects in it” in the face of an uncertain future based on the response to COVID-19.
Extra money will be reserved, he said, noting that the city is positioned well right now with strong contingency funds.
Staff is looking at potential long-range impacts to the city’s budget, Whitlach said he thinks property tax revenue should “stay pretty solid” short of people not paying their property taxes.
At this point, city staff members are trying to balance what the future may look like with immediate needs, he said.
Aziz said Whitlach has done a great job, especially an engineer thrown into the role of city manager, and “the city has things pretty under control.”
Stauder praised the work of the Information Technology Department in helping employees work from home and setting up remote meetings, as well as Aziz’s informational videos.
Other councilors applauded the work of the IT staff, as well as emergency responders from the police and fire departments.
Grizzle, who is the chamber director, said that the Ambassadors are going to call and check in with businesses to ensure they’re aware of resources available to help them, and added, “I think everybody’s doing a good job. I’m proud to be part of Lebanon.”
Rieskamp thanked the citizens.
“I see them obeying the distancing,” he said. “They’re wearing masks. The sad thing is when you drive down Main Street, we’re kind of a ghost town.”
Steinhebel said the roll-out of iPads for the councilors was well-timed.
She also said the community’s response to the pandemic has been “a testament to our resiliency.”
She has been impressed with the level of support in the community for healthcare workers and emergency responders.
“This situation sucks,” she said. “I’m glad I’m going through it in a community like Lebanon.”
Bolen, division chief of fire and life safety and fire marshal, said the city’s IT staff has been helpful to the Fire District as well.
“It’s been a trying time for us,” Bolen said. “It’s unprecedented for everybody. I’m also very grateful that everyone is following the directions of the state and the nation.”
The Fire District is prepared, he said, and noted that “Lebanon will do very well with this. It’s just in our nature.”
“We owe a big debt to the citizens that are out there working in some pretty hazardous environments, not just the first responders, people that are working in the stores and the businesses that are critical to us,” Furlow said.

Mayor: City manager search may extend through remainder of year

By Sean C. Morgan
Lebanon Local
The Lebanon City Council is moving forward with its search for a new city manager, but it could take through the end of the year because the council wants to ensure the public has an opportunity to provide input.
“We’ve narrowed it down to five candidates,” said Mayor Paul Aziz Wednesday, April 15, the day following a closed executive session of the City Council. “We will be doing Zoom-type interviews May 6 all day. We’ll have each of the candidates one at a time.”
That’s still weeks away, Aziz said, and he’s hoping the city will have a better handle on the COVID-19 issues and be able to figure out how to get public input on finalists selected during those interviews.
“We want to make sure the public’s involved as much as we can,” Aziz said. The council wants to get public comments like it has in the past. If the city cannot do that physically before the end of the year, then the council will do the next best thing it can, electronically if it must, he said.
Aziz is hoping there will be a path as far as scheduling a physical meet-and-greet event and in-person council interviews by the time of the May 6 interviews.
He personally would prefer in-person final interviews, which allows councilors to see body language and other cues, he said. “You don’t always get that completely on the phone and the computer. But we will make adjustments if we have to. We’re going to have to be adaptable.”
The candidates will need to be adaptable too, Aziz said, noting that they’re all already going through this too.
Aziz said the process was intended to result in the hiring of a new city manager this summer, but at this point it could take till the end of the year.
“I would love to see a fall timeline,” he said. “But that is dependent on how the governor changes things and how things are going. We’ll do what we can, always keeping the public in mind.”
The council wants the public to understand how it makes the decision and why, the mayor said. The council could move forward electronically on its original timeline, but the council wants to ensure the public has its chance to meet the candidates and provide input.
Until the council hires a new city manager, Ron Whitlach will continue working as interim city manager, Aziz said.
“Ron is an awesome person. He has just been the strong captain of the ship. He’s really good with everybody, the staff, the public, us. I think he could handle it through the end of the year.”