Council to bring FY’26 budget for public hearing, set ballot language on wastewater plant bond

By Zach Hagadone
Reader Staff

The Sandpoint City Council is cued up for an especially consequential meeting Wednesday, Aug. 20, which will include the final workshop and public hearing for the Fiscal Year 2026 budget and consideration of ballot language for a bond measure to fund reconstruction of the wastewater treatment plant.

Councilors approved the preliminary $49,927,665 budget in late July, and made a few changes to it on Aug. 6, including voting 4-2 to shift $40,000 to the SPOT bus so that it could reach $145,000 in funding for the year. 

(Find the full FY’26 budget book at bit.ly/4oACx86.)

The council also voted 5-1 on Aug. 6 to accept a $950,000 grant from the Idaho Department of Parks and Recreation to reconstruct the RV park at City Beach. 

Work on the RV park is included in the preliminary FY’26 budget, and the IDPR grant includes a $50,000 local match.

Also in the preliminary budget is a nearly $10 million enterprise fund for wastewater, and $4.5 million for wastewater system upgrades. However, those amounts don’t come close to what city officials have long said is necessary to reconstruct the treatment plant in order to ensure adequate service and meet regulatory standards.

The ballot measure that City Hall is preparing for the November election will seek upward of $130 million in bonding authority to put toward the long-term project, though the precise language to be put before voters won’t be decided until Aug. 20.

Meanwhile, councilors took in a presentation at their Aug. 6 meeting from bond counsel Hawley Troxell and public relations firm Portman Square Group on the results of a survey launched in late July seeking residents’ feedback on the state of the wastewater plant and getting a sense for how much support there might be for the ballot measure at the polls.

Though the survey was originally meant to close in the first week of August, it remained open as of press time on the recommendation of Portman Square in order to gather more responses.

(Find the survey at survey.zohopublic.com/zs/5fD9Ks.)

By the time of the Aug. 6 meeting, the survey had garnered a total of 223 responses — 159 completed and 66 partial — with 98% made up of registered Sandpoint voters.

Amy Holly, of Boise-based Portman Square, said that the number of responses was not statistically significant, falling short of the target of 350. However, much of what respondents entered in the survey indicated both awareness of the situation at the outdated treatment plant and willingness to support bonding for addressing those needs — even if it means higher sewer rates, but only if the city makes an “aggressive” effort to seek state and federal grants, low-interest loans and other sources of financing to offset the burden on ratepayers.

The survey showed 67.2% of respondents were “highly aware” of the need to replace the plant, while 23.81% were “somewhat aware.”

“This is really good data. It means that the city has already done a good job of communicating the need that exists with respect to its wastewater treatment facility,” Holly said.

Meanwhile, 70.06% of survey takers said replacing the facility was “very important” to protect public health and water quality in the Pend Oreille River, with 19.15% describing it as “important.”

The city presented respondents with two options for funding: an $80 million Phase I approach to address only the most critical aspects of the project, and a $130 million option to cover the estimated total cost.

Overall, 68% of respondents said they “strongly” or “somewhat” supported the $80 million proposal, while 65% felt the same way about the $130 million alternative.

“These are good, strong indications that the community is supportive and that even knowing that there will be a rate increase, this is a project worth considering,” Holly said.

However, support declined significantly among respondents when polled on rate increases associated with the respective funding levels.

The $80 million route would raise an example $100 monthly utility bill to $160 over five years — which 43.11% said they’d support and 35.93% said they’d reject — while the $130 million option would see that model $100 per month bill go to $206 over five years, with 51.81% against and 29.52 in favor.

“Unsurprisingly, when people are faced with a potential to $206 over five years for that $130 million project, the topline support level does decrease,” Holly said.

Sandpoint Finance Director Sarah Lynds said that if approved, those rates would hold for the 40-year term of the bond. Meanwhile, “without any bonds at all” — that is, if the full burden of financing the project fell on ratepayers alone — Lynds said a hypothetical $100 per month bill would rise to between $300 and $400.

In the survey, support for increased rates rose to 62.65% and 46.06% for the respective $80 million and $130 million options if the city “commits to aggressively pursuing” other funding sources to “reduce the amount that must be borrowed and lower the rate impact.”  

One result in the survey “could be a major barrier to support,” Holly said, referring to a question about respondents’ confidence that the city would responsibly and efficiently manage the funds:  26.51% were “not very confident,” 24.7% were “somewhat confident,” 17.47% were “very confident,” 16.87% were “neutral” and 14.46% were “not at all confident”

Holly described the overarching message from that question as the city’s need to clearly communicate what is being done with the money and provide ongoing transparency.

In response to a question from Sandpoint Mayor Jeremy Grimm about how the lack of confidence displayed in the survey stacked up against other such surveys, Holly said it was “not out of line with what we have seen in other campaigns.” 

“I do think that the level of trust in government — whether that is local, state or federal — has gone down and I think that there is a propensity among voters to be skeptical,” she added.

Overall, based on written responses to the survey, top concerns from respondents included: cost to residents/affordability (43.1%), lack of trust in city leadership (25.7%), developer accountability (22.8%), demand for federal/state grants (20.4%), and facility location and odor (15.6%).

Regarding “developer accountability” Holly said survey takers meant that developers in the community should pay “their fair share” because the project is related to growth.

“We tried to communicate that it was not a growth-related expenditure or necessity, but this is one of the other opportunities we have to communicate to our city residents that this is not a function of growth, but this is really about need at the facility itself, absent growth,” she said.

Council President Deb Ruehle pointed out the small sample size for the survey, and cautioned that it likely doesn’t represent the true willingness of voters to support such a measure at the polls.

“We’re really only looking at a sample of about 250 people,” she said. “Sometimes in the lovely little town of Sandpoint, the people that spend the time to fill these things out are the more informed and are the more conscious individuals. So, I just believe we may have a lot of hard work ahead of us to educate the entire community about the importance of the sewage treatment plant.”

The Wednesday Aug. 20 meeting of the City Council will begin at 5:30 p.m. in the Council Chambers at City Hall (1123 Lake St.).