Flood Protection Authority may reach agreement on levee fees

Michael P. Buffer

Apr. 19, 2009 (McClatchy-Tribune Regional News delivered by Newstex) -- After five months of talk about imposing fees on landowners who get flood protection along the Susquehanna River, Luzerne County officials may finally adopt the controversial fee.

The Luzerne County Flood Protection Authority meets at 11 a.m. Tuesday. Officials have been fine-tuning fee proposals for months.

According to the latest revisions unveiled at a public hearing on April 1, the owner of a residential property assessed at $100,000 would pay an annual fee ranging from $42 to $63. Authority members this month have eliminated one option -- charging all 36,593 owners of developed property in Wilkes-Barre, Hanover Township, Plymouth, Edwardsville, Kingston, Swoyersville, Forty Fort, Pringle, Exeter, Wyoming, West Wyoming and Luzerne.

The authority is now looking to charge just the 15,306 owners of developed properties who get flood protection inside the 12 municipalities. The flood plain from Hurricane Agnes in 1972 determines which properties are protected by the levee system.

If authority members decide to charge for levee protection, they will have to decide whether to impose a fee solely based on assessed value or five fees for five property categories.

"The group has to pick which option," said Luzerne County Commissioner Stephen A. Urban, chairman of the authority. "I haven't made up my mind."

The five categories are: residential properties valued at more than $100,000 and less than $100,000; and commercial, industrial and tax-exempt properties valued at less than $250,000, more than $750,000 and between those amounts.

The owner of a residential property assessed at $100,000 would pay an annual maximum fee of $63 if the fee is solely based on assessed values and a maximum fee $46 if it is based on the five tiers.

County finance woes

The cash-strapped county has been paying for levee system maintenance with general fund revenue, but the county's ability to raise its tax rate is limited in 2009 because of property reassessment. The county has a new assessment system for the first time since 1965 and can't increase property tax revenue by more than 10 percent in the first year reassessed values are in place.

County commissioners removed flood-protection spending from this year's budget, so the flood protection authority has to generate its own revenue. Levee-protection fees would raise $1.7 million in revenue, which would cover costs associated with maintaining levees and pump stations.

A $1.7 million cut in the budget helps county commissioners move toward balancing the county budget. Last year's deficit exceeded $25 million, and despite spending and jobs cuts in this year's budget, a deficit of at least $17 million is projected.

"My goal is to not have to borrow any more money," Urban said. "I do not like to borrow money unless it is strictly for capital projects."

The county tax rate will not be limited in 2010 by reassessment. But Urban said he would wait for a report from a financial consultant before deciding whether to fund levee-system maintenance in the 2010 general fund budget.

The county is legally able to use general fund revenue to pay for levee-system maintenance, but the authority can only charge fees on property owners who directly benefit from flood-protection services, county solicitor Vito DeLuca claims.

Kingston Mayor Jim Haggerty argues flood-protection fees should be charged throughout the county because all county residents and taxpayers "are served by the protection the system provides to our quality of life, our infrastructure and our economic activity."

Levee-fee revenue would not cover costs associated with event programming and park maintenance at the riverfront area known as the River Common, said Jim Brozena, executive director of the authority. The $25 million riverfront project -- which involves building an amphitheater, boat landing, fishing pier and two scenic levee openings with flood gates -- should be completed by mid-June.

Brozena has defended the levee fee by claiming levee protection significantly reduces flood insurance costs. A $100,000 residence with insurance on $40,000 of contents is paying $287 for flood insurance and would pay $1,177 without levee protection.

Municipalities maintained their shares of the levee system before the county authority began taking over the entire system in 1996.

mbuffer@citizensvoice.com 570-821-2073

Levee-fee projections -- five-tier proposal with stable rates over five years

Residential properties valued at less than $100,000 -- $46.85

Residential properties valued at more than $100,000 -- $93.70

Commercial, industrial and tax-exempt properties valued at less than $250,000 -- $225.48

Commercial, industrial and tax-exempt properties valued between $250,000 and $750,000 -- $450.96

Commercial, industrial and tax-exempt properties valued at more than $750,000 -- $676.44

Luzerne County general fund deficits

2004 -- $17 million

2005 -- $12.5 million

2006 -- $4.6 million

2007 -- $9.3 million

2008 -- $25.5 million

2009 Luzerne County Flood Protection Authority expenditures to be funded with levee-fee revenue

Operating costs -- $1,078,000

Authority costs -- $100,000

Levee certification -- $125,000

Capital equipment -- $50,000

Sinking fund -- $42,090

Fee administration -- $53,550

Riverfront costs -- $25,000

Uncollectables -- $154,073

Total -- $1,627,713

Newstex ID: KRTB-0417-34242664