The Hailey City Council opened a discussion Monday about funding options for a new town square, the redevelopment of River Street and other possible public infrastructure projects.

Capital levies, two-year or permanent property tax levies and renegotiated utility franchise agreements were described as possible funding options.

City Administrator Heather Dawson said Hailey is considered a “low property tax city” because it taxes its residents less than 50 percent of the limit allowed by state law, or under a 0.004 levy rate per $1,000 in property valuation.

“Because of this, a property tax levy would only require 60 percent voter approval,” she said.

Property tax increases that would increase the levy rate above 0.009 percent per $1,000 valuation would require approval by two-thirds of voters, Hailey Treasurer Becky Stokes said.

The proposed town square project, which could cost up to $1 million, is currently unfunded.

The city has $2.1 million in grant funding to pursue a $4.3 million upgrade to four blocks on River Street.

Public Works Director Brian Yeager said Monday that the city could use about $700,000 in Hailey Urban Renewal Agency funding, and a federal Better Utilizing Investments to Leverage Development (or BUILD grant) application to bridge the funding gap for River Street.

Dawson said the BUILD grant application would require matching municipal funds to qualify.

Hailey voters passed a two-year Pathways for People property tax levy in 2016, raising $400,000 per year for two years, from a tax of $48 per year for $100,000 taxable value.

Dawson said that due to new property value assessments, the city could now raise $493,000 per year under the same levy terms.

A capital levy, which funds municipal projects, could raise as much as $40 per year for $100,000 taxable value, Dawson said, but it would not provide money for maintenance of the funded projects. Capital levies require 60 percent voter approval.

Dawson said increased utility franchise fees would take too long to raise money for a town square, but the city could consider a permanent property tax levy for public projects.

City Councilman Jeff Engelhardt recommended a mix of funding options.

“Property owners get hammered quite a bit already,” he said.

Mayor Fritz Haemmerle said the Pathways for People projects (which are nearly complete), connecting Hailey’s downtown core to the Wood River Trail, could one day be tied to the work on River Street.

“It all dovetails in together at some point in time,” he said.

No decisions were made as to launching a funding initiative.

In other Hailey news:

The Community Development Department will host a town square programming public workshop at the Hailey Public Library on Tuesday, Feb. 12, at 5 p.m.

A Streets Department report showed that snow removal was well under budget so far this year, but over budget already for spending on magnesium chloride for ice control. “It can take weeks to get rid of ice after a storm,” Public Works Director Brian Yeager said.

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