A proposed budget that could conceivably more than double the tax rate in the Camp Verde Sanitary District is being looked at as a “worst case scenario,” said District Chairman Gregg Freeman.
A structural failure that crippled construction on a new wastewater treatment plant in January was found to be the fault of the engineers who signed off on the plans, Phoenix-based Coe and Van Loo, according to an independent engineering analysis.
The district is actively involved in negotiations with Coe and Van Loo to get the engineering firm to pay for the repairs, Freeman said. While the company has agreed in principle to pay for most of the costs, executives still have some questions about who else should throw in for the tab. Most recently, Coe and Van Loo figures their share to be somewhere between $1.3 million and $1.5 million.
Repairs will cost $1.98 million, according to the most recent budget estimates, and would put total district expenses at around $2.65 million, more than double the current year’s projected spending budget. With property in the district valued at nearly $40 million, taxes were assessed at $2.31 per $100 of value, including a levy to fund the district’s debt obligations.
The tank failure has already pushed back the plant’s construction by at least six to seven months, and the negotiations over liability are occurring in the midst of budget season, when the district is required by law to approve a balanced budget.
Hopefully, Freeman said, all sides will reach an agreement before the budget has to be made final. Until then, however, the district has to look at the possibility of absorbing the cost for the plant repairs and, if they refuse to pay, taking Coe and Van Loo to court for reimbursement.
If the “worst case scenario” were to come to pass, taxes would have to be raised to $4.99 per $100 of value to make up the difference in the upcoming fiscal year. That doesn’t include a proposed debt reduction levy of nearly $1.10, which would, in effect, raise sewer taxes to almost $6.09 per $100 of valuation.
That means that the owner of a home assessed at $200,000 who paid $4,620 in sewer taxes last year, would pay $12,180 this year.
Freeman said the district board was doing everything it could to make sure that scenario doesn’t occur.
