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RVCOG asks cities, counties for cash Mail Tribune / Jim Craven Mark Silbernagel, of the James W. Fowler Company of Phoenix, scales the side of a water tank being built above Interstate 5 in Phoenix. The tank is part of the Talent-Ashland-Phoenix water intertie project, which the Rogue Valley Council of Governments is coordinating. Cash-flow problem follows years of credit use By JESSICA SMITH Leaders in a dozen cities and two counties have another request to consider this budget season: The Rogue Valley Council of Governments wants $200,000 to improve its cash flow. RVCOG officials say they need the money to establish an internal cash reserve and retire a $200,000 line of credit they use for routine expenses. Though officials for Jackson County and a few cities have tentatively approved the request - jurisdictions would pay anywhere from several hundred dollars to more than $48,000 - some Medford leaders say they want to explore alternatives before doling out the dough. "The city of Medford is not a cash cow for everyone," Councilman Bill Moore said. COG plays multiple roles Formed in 1968, the Rogue Valley Council of Governments is a player in nearly any project that involves two or more local jurisdictions. From the water intertie project in Phoenix to a regional consortium on growth, the council of governments encourages cooperation between cities in Jackson and Josephine counties. In addition to regional planning, the agency administers senior and disability services programs for the state. RVCOG also assists its members with transportation, air quality and water resource management projects. Two counties and 13 cities pay annual dues to RVCOG, part of the agency's $5 million annual budget. In 2001-02, the council of governments expects to collect $141,000 in dues, about 4 percent of its budget, from its members. Under RVCOG's proposal, Medford would pay $48,860 into the cash fund. "This is just foisting the responsibility of other people onto us and I stiffen at that," Moore added. Under its funding structure, RVCOG collects annual dues from its members and contracts for work on a reimbursement basis. That means the agency must cover payroll and operational expenses before it's paid for actual work, explained Michael Cavallaro, RVCOG executive director. But the agency's request for additional funds from its members says nothing about RVCOG's fiscal stability, Cavallaro asserted. The council of governments maintains a $5 million budget for regional planning, senior and disability services and other programs. "Financially, we're in good health," Cavallaro said. "Our bottom line is fine. Our revenues meet our expenditures, but the timing is way off." RVCOG for several years has used a $200,000 line of credit from US Bank to offset delayed reimbursements, but Cavallaro said the agency exhausted its credit last year. Cavallaro said the council of governments has since paid down the debt - to about $160,000 - by seeking payment more aggressively on past-due accounts. The agency's cash-flow problems are further complicated by the state Department of Human Services' request for repayment of a 15-year, $160,000 loan by June 2003. In January, RVCOG's board of directors and representatives from its members met to develop a strategy to settle the human services loan, pay off the bank, and establish an in-house $200,000 cash reserve. Their strategy: Ask each agency member to make a one-time cash contribution that could be spread out over three years. The amount of the contribution depends on the size of the city or county. The city of Butte Falls would put $340 into the pot, the smallest amount requested from an RVCOG member. Medford, meanwhile, is asked to make the largest contribution. Jackson County's 2001-02 budget committee recommended paying a one-time sum of $46,700 to RVCOG to cover its portion. Officials in Ashland, Central Point, Jacksonville, Phoenix, Rogue River, Shady Cove and Talent also have indicated support for the funding request. "The council of governments is such a valuable resource regionally," said Elise Smurzynski, Shady Cove administrator. "It just makes good business sense to make sure that resource has some financial certainty." Medford officials, meanwhile, requested city Finance Director Jef Faw to look into the matter. Faw said he plans to meet with finance directors from other cities to discuss the effect of RVCOG's request and look for alternatives. "You're looking at $16,000 a year in our case," Faw said. "That's not small change to our budget committee." Helping RVCOG A number of cities have agreed to help the Rogue Valley Council of Governments establish a cash reserve for the regional planning agency. RVCOG officials say the need for an in-house cash reserve does not reflect poorly on the agency's financial health. But the $200,000 reserve would enable RVCOG to meet monthly expenses while waiting for reimbursements from clients. Under RVCOG's proposal, here's what each member would pay over three years. (see right) City or county Amount Medford......................... $48,860 *Jackson County ............$48,740 Josephine County ............$40,680 Grants Pass................... $17,160 *Ashland .........................$15,820 *Central Point ..................$9,640 *Talent ............................$4,060 Eagle Point .....................$4,040 *Phoenix .........................$3,260 *Shady Cove ....................$1,900 *Jacksonville ....................$1,780 Reach reporter Jessica Smith at 776-4481, or e-mail [email protected] Mail Tribune Home | Ottaway Newspapers, Inc. | Dow Jones & Co., Inc. | Privacy | Contact Us Copyright � 2001 Mail Tribune, Inc.