Power plant closure leaves Palisade fire district short on funds

Faced with the expected loss of 40 percent of its annual tax revenue, the Palisade Rural Fire Protection District is hoping its residents will look past the troubled local economy and approve a property tax increase next month.

Without that boost, fire district officials fear there could be a gradual decline in fire and emergency medical services and an indefinite delay in the construction of a new fire station.

Fire district treasurer Maggie Somerville said the closure of Xcel Energy’s Cameo Power Plant at the end of the year will strip away about $50,000 in revenue, which makes up about 40 percent of the district’s annual total tax revenue.

The district contracts with the Palisade Fire Department to provide fire protection and ambulance service to roughly 500 homes in an 8 square-mile area between Rapid Creek and 35.3 Road.

Voters in the district are being asked to nearly double the mill levy from 3.2 mills to 6.2 mills. That would increase property taxes on a home valued at $200,000 from $51.82 a year to just short of $100 a year.

The increased mill levy would still be below the average Colorado fire district mill levy of 7.7, according to fire district officials.

Somerville said she believes Fire Department response times could increase and residents could pay more for ambulance rides if voters reject the tax increase. The district also wouldn’t be able to come up with its share of the money needed to build the new station.

“I see a gradual movement toward all of that,” Somerville said.

The district is expected to pay for half of $1.5 million first phase of the station and half of the total estimated $3.8 million price tag. Without the tax increase, the district’s $10,000-a-year capital budget is far short of what’s needed for the station.

In addition, the district’s reserve fund continues to decline. It stood at $340,000 at the end of last year but is expected to drop to $321,000 at the end of this year and $279,000 by end of 2011, Somerville said.

The election is Nov. 2.


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