By Susan de Castro McCann
Redstone Review Editor
LYONS – As is the case with every other town, city and municipality in the U.S., Lyons is struggling to find ways to make more money to pay for services.
The town needs to find ways to add revenue to its General Fund, which pays for most of the town services. The General Fund gets its revenues primarily from sales tax and building permit fees. The General Fund needs more revenue, and while there is money in other town funds, it is illegal under state laws to transfer money from one town fund to another.
To remedy this General Fund shortfall, at a recent Lyons Town Board meeting Town Administrator Victoria Simonsen suggested that Lyons employ a legal means used by Longmont and many other towns to augment the General Fund by use of a franchise fee on the town’s enterprise funds.
The enterprise funds are the only funds that actually generate revenue, Simonsen pointed out. Enterprise funds are generated from the fees, called franchise fees, that the town charges for the use of rights-of-way to bring services such as water, power and sewage disposal into the community. Basically this is a charge for the use of town-owned water and sewer lines and power lines.
All the municipalities in the area charge their enterprise funds a franchise fee. Simonsen pointed out that Longmont charges somewhere between 8 and 10 percent in franchise fees. Lyons charges Xcel energy and used to charge Quest to bring power services to Lyons. But if the enterprise is owned by the town, such as with the waste water fund, then Lyons could create a franchise fee to the waste water fund for, hypothetically say, three percent, and that fee would go into the General Fund. Of course the franchise fee is actually paid by the customers who use the waste water or water or electric service, and that fee is then put in the general fund rather than the respective enterprise fund. It becomes a legal way to transfer funds and generate more revenue for the General Fund
“A fee,” Simonsen explained, “is not the same as a tax.” That is to say that the state considers it completely different money and it can go into the General Fund. To the taxpayer paying the bill, it might be a different word, but money paid out is money paid out.
The board decided not to go ahead with the franchise fee on utilities for the 2012 budget, and will balance the budget without using any new franchise fees. “The issue is not dead,” said Simonsen. “I think that we might tackle it again next year, perhaps in January.”
Another issue that is looming for the board is the election that will take place in early April 2012. Town Clerk Deb Anthony told the board that a petition is being circulated to ban the sale of medical marijuana in Lyons. The petition may be on the ballot in April if the group working on the issue receives enough signatures. The petition is due by November 18. If the group collected enough signatures after the deadline, then a special election would be held. Momentum is growing for getting rid of medical marijuana in Colorado due to the pressure the state is receiving from the U.S. Justice Department, which wrote a letter to Governor John Hickenlooper stating that medical marijuana, and every other type of marijuana, is still illegal under federal law. Federal law supersedes state law even when a state has a state amendment to their constitution in place.
In other news, the town of Lyons will be getting a new intern to work full time for two years with the town staff. It is not a done deal, but the intern, if s/he signs the contract, will work in all the town departments including spending time on the budget in finance, working with the Economic Development Commission, working in the Parks and Recreation Department, working on the election with the town clerk, as well as many other duties. The internship is part of a master’s degree program called the Best and the Brightest, from CU Denver in the department of Small Business Development.
S/he will start after some time in December and the salary will be paid for the first year by a grant from the Colorado Department of Local Affairs, DOLA. The salary will be about $40,000 a year. The second year DOLA has committed to paying 50 percent of the salary and is looking for more funding to pay for the second half.
The new intern will also work with Jacque Watson, economic development and community relations manager, for Lyons, on the Main Street Program. Watson said that the town has decided to embrace the Main Street Program and will offer help to the business community to get started. No formal director or board has been created for the program yet.
The concept behind the Main Street Program is to have the town set up a mechanism for the downtown area merchants to form an organization, such as a downtown development district or some other organization where they create funding through some form of taxation or some other form to enhance and market the downtown area. The downtown area includes business on High Street and Broadway in Lyons. The program is basically a marketing mechanism to promote business and handle problems and concerns for downtown businesses.