On the fiscal side of Peachtree City, a lot has happened, some of it can be confusing, so it is good to see it pulled together for a “Big Picture” overview. All the numbers provided on the budget, streets and paths are from official city documents.
Infrastructure, meaning building, facility, etc., repairs are being paid for via Facility Authority bond debt. Homeowners pay for the debt via their property tax bills. The city pays for the debt just like you pay for credit card, mortgage and other loans, with ongoing payments of principle plus interest.
The money from the bond is either already spent or soon to be spent. But it does not cover all the repairs we need. So, we will be needing more money in the near future while still paying for the current bond.
On stormwater, the money from the initial stormwater bond of 2008 is spent, but we are still paying for the debt. Recently, line items from the budget were transferred to stormwater, more stormwater debt was taken on and the stormwater fee was increased to over 230 percent of last year.
So, we are currently paying for the 2008 debt plus the new debt via property tax.
In about 3 years we will be looking for new funding for stormwater, having spent the recent money from the new loan. That means another fee increase and more debt while still paying for 2008 and the current debt at the same time.
On the property tax total millage rate, the rate in 2010, paid in 2009, was 5.553. In 2011, paid in 2010, it was 6.783. In 2013, paid in 2012, it was 7.178. That is an increase of 1.63 mills.
The total millage rate for 2018, under the current budget approach, is projected to be 7.690. That is a total increase of 2.14 mills from 2010 to 2018.
The budget model projects increases in home values of 2 percent per year beginning in 2014. There is no rollback on the millage rate included, meaning your tax bill will increase even if the millage rate does not increase.
Moving on the streets and paths, it is a good idea to first get a basic understanding about asphalt and where our streets and paths stand on needing maintenance.
Asphalt is given a “condition rating.” Condition rating is a term for a numerical “grade” given to the present condition of the asphalt.
[A grade of] 100 means newly laid or resurfaced. As time goes by asphalt wears and breaks down due to traffic, environment, etc. The deterioration accelerates as the road gets older because the asphalt loses strength, flexibility and other attributes
The life of a street, in Peachtree City, is about 10 to 15 years. The target rating for resurfacing is below 80. Using numbers from GDOT, etc., asphalt deteriorates at an average rate of about 2.5 points per year.
The last evaluation for Peachtree City was done in 2012.
With that said, in 2012 we had 251 streets, totaling $6,624,369, and 103 paths, totaling $2,971,080, below 80. We had 8 tunnel and bridges need maintenance totaling $2,600,000. That is a total of $12,195,449 of maintenance as of 2012.
Currently we have no funding source for this maintenance.
That brings us to the 2-year SPLOST proposal that will be on the ballot this year. If passed, Peachtree City is expected to get $14,600,000 over two years. Staff intends to spend it over five years.
Staff proposes to spend $2.6 million on bridges and tunnels, $2.5 million on paths, $2 million on new paths and $7.5 million on streets.
At the end of the 5 years, we are looking at unfunded work on 11 paths rated 70s, 187 paths rated 80 to 89 and 264 streets with ratings of 80 to 89, as of 2012.
Remember the deterioration Rate of 2.5 per year means many of those will then be 12.5 points lower in rating, as in 60s and 70s. Projects now in the 90s will be in the 80s.
The cost of the SPLOST is about $200 per year, $400 total for the two years, for an average household. That is an average of $80 per household per year over the 5-year period the money would be spent.
To summarize, you are looking at future new taxes and fees via another facilities bond, stormwater bond, millage rate increase and increased property tax due to rising home values. There is a potential SPLOST. You are also looking at spending continuing to exceed revenue and a shrinking reserve.
As a business operates on a business plan, cities operate on comprehensive strategic planning. We have no such planning to prioritize needs over nice to haves. No plan to bring services into alignment with what citizens have told us they really want and prioritize. No economic development plan. No caps on spending.
We desperately need a comprehensive strategic plan.
This is where we stand via the course we are on to 2018 and beyond.
Don Haddix, mayor
Peachtree City, Ga.