In a special meeting Monday to set the city’s operating tax levy, Owensville aldermen kept the levy exactly where it was at last year.

John Tracy, the city’s administrator, noted the city needed to increase its levy to help pay off $1.1 million in street bonds approved by voters in 1998 and another $1.1 million in street bonds approved in 2003. The 1998 issue retires in 2014 and the 2003 issue retires in 2020. The city has been making mostly interest payments in recent years but principal payments on the heavily backloaded debt are starting to kick in. Funds from the city’s half-cent transportation sales tax are being used to repay the debt. Tracy said last week the city should be using those funds for street repairs and maintenance and paying off its debt with property taxes.

Ward 2 Alderman John Kamler began the discussion, which included additional comments from the public even though a public hearing had been held the week before. Only one resident commented at the hearing last week. Public hearings are required by state law prior to approval of tax levies.

“(Previous city officials) did some good old budget tricks with pushing the interest off and us paying only interest and a small, small amount of principal,” said Kamler. “Everything I see with (current bonding firm) Gillmore and Bell I’m leery of right now and I’m looking into getting an independent opinion if we can afford it. I’m prepared for no increase myself. I’ll just put it out there right now. I’m not ready to raise taxes right now for anybody.”

Ward 1 Aldermen Sam Britton agreed. “Same here,” said Britton, also elected this past April along with Kamler. “Do we have  some more surplus equipment we can get rid of to make up the difference?”

“We’re taking some slow steps and if we take some diligence and tackle this, we can get things back the way they should be,” said Kamler. “We’re doing our best to watch every dollar we spend in this place. That’s just my opinion.”

Brian Epstein, the board’s president, cited a modest eight-cent increase in 2007 for debt service while voicing opposition to the proposed 22-cent increase — up to 29.98-cents — proposed solely for debt service on the street bonds. The city could have increased its debt service levy higher last year which would have brought the overall operating levy up to $1. Tracy said the state auditors said the city could have increased its debt service up from the 8.14 cents per $100 to 96.45 cents per $100 assessed valuation — for a total levy of $1.5641 — simply to pay off these street bonds.

“Since we didn’t raise it last year or budget for it this year, I think we should leave it where it is for now since people will be hit hard by high heating bills this winter,” said Epstein.

The city eventually set an operating levy of 65.92 cents per $100 of assessed valuation last summer. That figure included the 8.14 cents for debt service on the street bonds.

Several residents were given the chance Monday to voice their opinions.

“If there is some way you can do this (not raise rates), I’d like to see you do what you’re saying you want to do,” said William Jewett.

“You guys (current board) aren’t responsible for the debt that we’ve got,” said Dixon Somerville. “It’s been bad management for 40 years that has crept up to this point. Somewhere down the road, regardless of who does it, we’ve got to take the bull by the tail and get rid of this debt. We’ve got to get this down at some point because we’re wasting money by paying interest.”

“I’d like to see Owensville keep going,” said Rosely Jones. “But I’m afraid if we keep slapping more money on these people in this town that are already having a hard time, we’re going to lose more people and this will become a ghost town.”

“Nobody wants to buy your house,” added Juanita Chandler. “Nobody wants to live in Owensville because of all of this, so you’re stuck.”

“The only suggestion I’ll make is that we keep it at the current rate and come budget time next year, we’ll look to factor in a modest increase,” said Epstein. “We know we’ll have to do it to play catch up.”

A proposal to approve the ordinance setting the overall operating tax levy at 68.10 cents per $100 of assessed valuation was introduced by Kamler with a second by Ward 2 Alderman Rob Borgmann. Britton made the motion to bring it for a final vote where it was approved on a 4-0 vote.

(Reporting from the meeting by Will Johnson of The Republican’s staff).