Fire district might annex Ferndale to solve tax glitch

THE BELLINGHAM HERALDJanuary 18, 2014 

FERNDALE - If Whatcom County Fire District 7 annexes Ferndale to include the city in its tax rolls, fire protection should look the same. Property-tax payments shouldn't change.

If approved, the move would mostly affect Ferndale's accounting and Fire District 7's elections. The City Council will discuss the proposal at its meeting at 6 p.m. Tuesday, Jan. 21. The council meets at 5694 Second Ave.

Although Ferndale sits roughly in the middle of Fire District 7, city property owners don't pay taxes to the district. Rather, the district sends a bill to City Hall every year for the amount of taxes the district would collect inside the city.

Receiving emergency response and fire protection through a contract with the district hasn't worked well for the city in recent years; Ferndale has seen its bill rise dramatically. The bill from the district for 2013 was $1.24 million, 8 percent more than the previous year and almost twice as much as in 2006.

The main source of the problem, city and fire officials say, is the push by heavy industries at Cherry Point to have their property values reduced.

"We've been struggling with challenges with our major industries the last few years, and we're struggling with them this year again," Fire Chief Gary Russell said at a City Council committee meeting on Wednesday, Jan. 15.

City Administrator Greg Young filled in the specifics of Russell's statement.

"The industries out at Cherry Point are able to negotiate and adjust their (property) valuation based on what they build and what they take out of service," Young said.

Russell and city officials said the solution is for the fire district to annex the city and collect taxes from city property owners.

"The main benefit to the city is, we're no longer going to get an annual bill that will severely impact our fund balance," Clerk Sam Taylor said.

With a larger tax base, the district would be buffered from the large fluctuations in property values at Cherry Point, Russell said.

The city would reduce the amount of property tax it collects so that business- and homeowners would see no change to their property-tax bills.

"It's revenue neutral. You're not going to pay a dime more," Young said.

If Fire District 7 annexed the city, then Ferndale residents could both vote and run for fire commissioner. Current commissioners haven't warmed up to the proposal, Russell said.

"Their biggest concern is, there's loss of control, obviously," he said.

If City Council members favor the proposal at their Jan. 21 meeting, they will consider it further on Feb. 3. City and fire district voters both would need to approve the annexation.

Reach Ralph Schwartz at 360-715-2289 or ralph.schwartz@bellinghamherald.com. Read his Politics blog at bellinghamherald.com/politics-blog or get updates on Twitter at @bhampolitics.

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