The Salida city council held their second work session of the month on October 14, 2024. Council member Dominique Naccarato and city administrator Christy Doon attended remotely.
Financial Management Plan
First, a financial management plan was presented to the council–several of them, in fact. The presentation showed council’s past finances and their trajectory for the future, and different ways their future could go based on what council decided to do.
The timeline from 2019 to (budgeted) 2025 was shown first. Salida is running into its post-COVID “new normal.” The city has seen increases in its city tax and intergovernmental revenues, which is better than expected and typical for most of Colorado.
Sales tax revenues however, are flattening, and everyone is starting to feel “the pinch of inflation”. Costs have increased 61 percent, but total revenues in the general fund have only increased 29 percent; despite this, the general fund balance has only decreased about two percent. Though council does a good job of balancing the budget, “the city has a revenue problem,” concluded financial consultant and presenter Melissa Buck. With the city’s current trajectory, the general fund will be negative by 2029, and won’t get out of it until 2033.
This German cargo ship has a list to port side. This list must be corrected if the ship is to sail smoothly. Photo: Toni Walk
In order to “right the ship,” the city would have to cut a significant amount of expenses from the general fund. The best solution proposed is to simply get more revenue, but that’s much easier said than done. The most realistic options are to manipulate the soaking pools project that was discussed later in the meeting, or to implement a sales or property tax (if voters approve). Buck also suggested integrating the Salida Fire Department with the surrounding fire protection district, or cutting programs and staff. These scenarios were all mapped out in the presentation.
All of these scenarios are hypotheticals. Buck called them “food for thought.” Plans like this would be updated every year, and really they are simply a forecast based on what financial decisions council makes.
“I wish we could’ve used this tool a little sooner this year, than right before adopting the budget,” said council member Suzanne Fontana.
“There is a version of this tool in use, but this is a more flexible version where the city can calculate how the budget will be impacted by new growth. However, these tools lean conservative, and, of course, cannot see possible ‘black swan events’,” Buck said.
Council member Alisa Pappenfort liked the idea of a property tax. “80 percent of our homes are people who don’t live here,” she said. “Is it upside down like this throughout Colorado?” Buck replied, “in mountain communities, yes. It’s making a lot more people pay attention to workforce housing. Salida has a short-term occupancy tax, but no actual property tax.”
“We’ve got a lot to digest with this,” said Mayor Dan Shore.
Outdoor Soaking Pool Update
Parks and Recreation Director Diesel Post came to present an update on the soaking pool project at the Salida Hot Springs Aquatic Center, that Salida has been debating for some time. “I hate to be the next person in line here, after that,” he joked.
Due to the bare bones budget, and the unfavorable forecast for funds in the coming years, Post explained the soaking pool project as it stands now and some possible paths council could take with it. Costs have gone up significantly; since its original iteration, $350,000 has been added to the total price, and the initial $900,000 budget line item has been shelved.
One pool could be cut from the plan (but lowered revenues more than offset the savings). In addition, there were more expenses for the water pump house than expected, and the plans are already five years old. A lot of plans have changed to be more expensive, which makes the plan particularly unsustainable.
The soaking pools were Post’s first project when he was hired in 2019. Since then, one of his responsibilities has been to build these soaking pools; he came to council for direction on how to proceed.
Council member Aaron Stephens understood the need to take stock. “I think now would be a good time to go back and start from the beginning,” he said. “I know it’s a lot of work, but a lot of people would like to see them happen.”
Jess Downing, the chairperson of PROST, was also there to speak. “We understand that money’s tight, but granters love seeing shovel-ready projects,” she said. The Salida Soak and Swim group has a vendor lined up to do a feasibility study (which hasn’t been done since 2012). “We want to make sure this project […] won’t lose momentum.”
Wendy Gorie, a member of the outdoor pools committee, mentioned “that the project has a donor who is willing to give $50,000 to the project–but only when it’s in the build stage. The donor is adamant that the city has [financial] buy-in, and this buy-in could be for the study. The company that the soaking pools group is looking to would change about $12,000, much lower than the up to $50,000 some might charge.”
During discussion, the council was divided. Council member Dominique Naccarato asked about planning grants, which are frequently given to nonprofits; this would be possible to consider. Council member Justin Critelli said this presentation “feels like Groundhog Day,” with how many times they have had to reassess these pools. Mayor Dan Shore worried about sending the community on another chase for funding.
Pappenfort was particularly incensed. “We have wasted so much money on plans that you say are stale,” she said. “I’m done with this. We can’t do it. We missed our opportunity.”
Council saw her point, then Naccarato gave more input. “If the right grant comes along, I’d like to see a full feasibility study and otherwise the project goes into dormancy until that grant comes along.”
“Once again, I appreciate all of the work that you, PROST, the pool committee [do] […] I know this has got to be really frustrating, and it’s frustrating for us too,” said Mayor Shore.
Community Development Department Updates
Department director Bill Almquist gave a status update on development projects within the city. He explained that there is some expected lag time between approval of land use applications, when the department sees a building permit, and when developed units receive their certificate of occupancy.
1,666 units and 431 inclusionary housing units have been entitled, but not yet built. These numbers do not include the Angelview development, accessory dwelling units, “one-off” units, or either of the proposed senior living projects.
The fire station is 80-90 percent complete and Almquist expects that it should be finished by the end of this year. The Upper Arkansas Area Council of Governments offices’ building permits are now in review.
Almquist reviewed numbers of total permits versus total new residential units from the past four years, noting the number of new residential units has stayed fairly consistent (within a range). Since 2023, the number of new residential units has only dropped by 12 percent, but the number of new permits has dropped by over half. Almquist said the reasons for the decline are “interest rates, interest rates, interest rates…” However, he expects a cut to the interest rates that should spur a lot of growth.
The new land use code has lagged a bit because the department recently replaced lost staff. Meetings are being set for the coming weeks, and he hopes to bring the new code to the land use advisory committee by the end of the year, prompting Council Member Pappenfort to say “Sounds like exciting progress.”
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