By JASON COX
Of the Keizertimes
The framework for a fee on cell phone providers – and potentially affecting their customers – is on the agenda at the Nov. 15 Keizer City Council meeting.
If passed, the telecom ordinance would give councilors authority to assess a fee on gross percentages of telecommunication company revenue. City Manager Chris Eppley has initially proposed a 3 percent fee for wireless providers, but that won’t be set at the Nov. 15 meeting.
Eppley proposed the fees would be earmarked within the general fund for paying 911 costs as well as public safety communications, i.e. radio and other communication systems, and an area-wide records management system.
All three are managed by the Willamette Valley Communications Center. Keizer Police, along with Keizer Fire, Salem Police, some other Marion County agencies and all Polk County agencies, contract with WVCC to some extent.
The stated purpose is to recover some of the costs associated with providing 911 service to residents. The state assesses a 75-cent 911 fee on every phone line, cellular or land-based, and distributes portions to cities to cover the cost of 911 service.
However, these distributions alone do not cover the cost of providing 911 service, along with other tasks the city contracts with WVCC for, including providing a records management system and a radio communications system.
“This would also go towards that, which since the general fund is basically 80 percent police … those dollars basically translate directly into law enforcement,” Eppley said.
They don’t yet have solid revenue projections, he said.
In his memo to councilors Eppley also argues cell phone companies, unlike landline phone providers, don’t pay franchise fees, causing a potential equity issue.
Costs for dispatch assessed to member agencies are based on two factors: The population served and the number of calls a particular agency responds to.
The most recent numbers from the City of Keizer indicate the city netted $107,900 from the state’s 911 distributions. The city sent an additional $72,100 to Keizer Fire District.
However, the city’s bill for WVCC is expected to be $436,500 for the current fiscal year. The city also considers items like radio and mobile system support, officer cell phone allowances, the telephone system along with area-wide records management and information technology expenses as part of the overall impact of telecommunications on the city’s budget. According to figures from Finance Director Susan Gahlsdorf, the city has an annual net telecommunications deficit of $610,700, which must be filled in with general fund revenues – which funds police personnel expenses along with parks and other city expenses.
The cost to the Keizer Fire District for this fiscal year is budgeted at $319,732, according to a memorandum from Fire Chief Jeff Cowan.
“We’re trying to find ways to deal with that overwhelming cost,” Cowan said. “It’s taking away funds taxpayers give us to run the fire district. Ultimately, it puts boots on the street.”
The ordinance would allow for a minimum fee of $500 for telecom companies who have customers within Keizer. Those with gross revenues of less than $10,000 from Keizerites would be exempt.
Telecommunication carriers with equipment in the city right-of-way – such as Qwest, the city’s franchised telephone service provider – could pay up to 5 percent. However, Qwest already has a franchise agreement with the city and has been paying a percentage of gross revenues for quite some time.
The ordinance would affect companies like cell phone providers and CLECS (competitive local exchange centers), who are companies that lease space from the primary phone provider and also offer telephone or other communication services.
If passed it requires telecom companies providing services within Keizer to obtain a license from the city. Companies would report annual revenue and be assessed an amount based on the gross revenue, presuming the council acts to actually impose the fee.
At a work session Monday, Nov. 8, WVCC Director Mark Buchholz explained to councilors how the agency works and where costs come from.
The WVCC is part of the City of Salem, and various agencies choose to contract with them to provide services. Buchholz said the rates are based on the agency’s population served and the number of calls taken, and said money received from those agencies does not go into the City of Salem’s general fund.
It has about 60 employees, most of which are union-represented. Its budget is 80 percent personnel, Buchholz said.