City Finances

Ashland’s balance sheet is strong, and the operating gap in our General Fund is real. Both are true, and the gap is structural. We’re simply trying to do too much without the revenue streams to cover it all – firefighting and ambulance services, police, parks and recreation, and general administration. I voted for last year’s fee increase to buy time for a real fix, which we put in motion by contracting expert analyses of our firefighting and ambulance services. What’s certain is that trying to close the gap out of reserves won’t work beyond the next biennium. Although we have taken some important steps to trim costs, ultimately we’re going to need a structural solution.

Here’s the bind: In the 1990s Oregon voters capped property tax rates and limited growth in taxable value to 3% a year. Unlike California, that value doesn’t reset when a property sells. Look at an Ashland tax bill and you’ll see maximum assessed value sitting at roughly 60% of real market value. So when revenues can’t keep up, cities have three moves: cut services, spend reserves, or raise revenue not subject to the cap.

I’ve served on the Citizens’ Budget Committee since 2021 (two years before I joined the council) so I’ve watched this shift up close. Ashland ran surpluses from 2017 through 2023, and we carry very low debt. The City closed last fiscal year with General Fund reserves at 181% of what our own policy requires—and we have $2 million in a separate Reserve Fund (not counting the $4 million payment just received from Asante) compared to just $40,000 four years ago.

But expenses have outstripped revenues for three years running, and our finance director projects a widening gap in the next biennium unless we take corrective action. The cushion you spend is gone, and we shouldn’t try to stretch ours through another biennium.