Fahey Suggests User Fee Trade-Off
WHEELING – Vice Mayor Eugene Fahey may support charging a $1-per-week user fee of those who work in Wheeling – if City Council offsets the impact to residents by also cutting the fire service fee in half, he told Wheeling Kiwanis Club members Thursday.
However, he said such a move wouldn’t necessarily mean the city should abandon its plan to reduce costs by cutting the size of its workforce. City Manager Robert Herron has proposed a number of spending cuts, including eliminating about 20 mostly vacant positions from the city’s budget, in order to avoid a projected $250,000 budget shortfall by the end of this fiscal year.
That plan, which includes reducing the police force from 83 officers to 72, isn’t sitting well with some council members, however, leading some to suggest raising taxes to avert the cuts. One idea, advanced by Councilman Ken Imer, is to charge a user fee, possibly $1 per week, to all who work within city limits in order to avert the cuts.
Such a tax, proponents say, would ensure that those who live elsewhere but work in Wheeling and take advantage of city services pay their fair share.
But Fahey said there may still need to be cuts, even if council ultimately decides to enact a user fee. He doesn’t support new taxes simply to close the city’s projected shortfall this year, but said he could be persuaded to back a user fee if the proceeds were dedicated to paying down the city’s pension liabilities.
“Our problem is not the immediate problem,” Fahey said during the Kiwanis Club’s weekly meeting at WesBanco Arena. “The root of our problems is the pensions.”
Wheeling charges a residential fire service fee of $95 annually. Reducing that by half and enacting a $1 weekly user fee, Fahey said, would place a minimal burden on city residents while still collecting revenue from out-of-city workers.
Such a proposal would not be revenue-neutral for everyone, however, as a user fee would be charged on a per-person basis, while the fire service fee is assessed on a per-household basis.
For example, a $1-per-week user fee would amount to $52 per year in additional taxes for a single person, while a 50-percent reduction in the fire service fee would offset that by $47.50. But a two-person household in which both people hold jobs within the city would pay a total of $104 in user fees per year, while still seeing only $47.50 in fire service fee relief.
It remains unclear exactly how much money a user fee would generate for Wheeling. Weirton, with a population of about 19,500, charges a $2-per-week user fee that generated about $840,000 during the previous fiscal year. Meanwhile, Charleston, a city of 50,800, expects to collect about $5.5 million from its $2-per-week user fee.
Under Fahey’s plan, a user fee would need to generate well over $1 million per year to offset the reduction in the fire service fee and still provide enough money to cover the expected increase in Wheeling’s pension obligations. The city expects to collect $1.9 million from its fire service fee, so a 50-percent reduction would mean a loss of $950,000 in revenue.