Revised figures now place the estimated cost of building a new fire station in Hailey's Woodside neighborhood at $2.8 million—far higher than a fall 2005 estimate that pegged the cost at $1.2 million.
The revised figures, relayed to Mayor Susan McBryant and members of the City Council by Hailey Fire Chief Mike Chapman during a special budget workshop Monday, have left Hailey officials in shock.
"It's a good thing he's trained in CPR," Councilwoman Carol Brown quipped.
Monday's meeting was the first of several workshops on Hailey's fiscal year 2006-2007 budget. During the workshop, officials discussed various issues related to the city's proposed $10 million budget, which is about $400,000 less than last year.
Speaking before the mayor and council, Chapman said the cost of the new fire station may climb even higher if construction is delayed much longer.
"That's dependent on breaking ground today," he advised.
Among the various options for funding the fire station, the council discussed the possibility of asking Hailey voters to approve a fire station bond.
In a letter to the city, Eric Heringer, a financial adviser with the Seattle-Northwest Securities Corp., said based on a 20-year repayment term with annual bond payments of $190,000 a year, the city could ask voters to approve a $2.34 million bond.
The remaining cost for the fire station would preferably come from a grant or reserved annexation fees, Hailey City Clerk Heather Dawson said.
Heringer said the annual bond payments are structured to match the $190,000 annual bond payment city taxpayers are currently paying to finance the Hailey City Hall and library. Taxpayers will make the last of those bond payments on Aug. 1, 2008.
If approved by voters during a February 2007 election—the date council members have said they prefer for such a vote—the first bond payment on the fire station would occur in February 2008. This would result in an overlap year where taxpayers would have to pay on both the old bond and the new bond, Heringer said in the letter.
Options for making the two payments include delaying the bond sale until the spring of 2008 or using some of the cash on hand at the city to make the 2008 bond payment on the fire station, he said.
In at least one way, current Hailey residents would be better served by financing the new fire station through bond payments rather than by cash, Heringer said.
"If the city pays cash for the project, current residents of the city will have footed the bill for the new fire station," he said. "New residents who move into the city will not participate in paying for the project."
"A bond issue can better match the useful life of the project with the potentially growing revenue source (new residents) that will benefit from the project," Heringer said.
While expressing cautious support for investigating such a bond vote further, council members agreed that citizens must first be allowed to comment on the proposal.
"I definitely want the public involved," Hailey City Council President Rick Davis said. "It's their money."
Other budget-related items discussed by the City Council Monday included the allocation of local option tax funds and the need to purchase new equipment for the Street Department.
Addressing the question of LOT funds, McBryant said she's uncomfortable saying how much of the tax will go to various entities like the Blaine Ketchum Housing Authority and the combined KART/PEAK bus system until the first returns from the tax are seen.
"We don't know what we'll be getting," she said. "After the first of the year it will become easier."
Hailey City Council members will continue discussing budget-related issues at their next meeting at 5:30 p.m. Monday, July 24. At that meeting, council members will likely adopt a tentative budget.
