911 director: Phone surcharge won't pay off county bonds for radio upgrades

Bob Swick, Branch County's 911 director, told the agency's executive board during a special meeting Tuesday a phone surcharge is not bringing in enough revenue.

That revenue is needed to pay off $9.3 million in bonds the county issued in 2021 to pay for emergency communication upgrades with conversion to 800 MHz radios and more towers. The upgrades removed communication dead spots with first responders.

“Over the last two years, there’s been a shortfall just shy of $2 million,” Swick said.

Voters in November 2020 voted 53% to 47% to increase the statutory 42-cent phone surcharge to $2.96 a month for six years. That charge shows up on all communication bills monthly for each telephone number.

The surcharge is added to each line on phones billed to county addresses.

Voters approved a one-mill tax assessment over a decade ago to fund the emergency dispatch $1.7 million general budget. 

County administrator Bud Norman warned the 911 board county commissioners to expect to double the cost allocation plan charges to 911 in 2027 to help pay to hire six new road patrol deputies under a plan soon to be considered by the commission.

Treasurer Steve Rutz said his research showed that since 2021, the county has collected $1,522,000 in surcharges. The total payments on the bond were $3,468,006, a shortfall of $1,946,346.

Swick became 911 director in September 2021 and was not part of the surcharge vote proposal.

Two years ago, 911 held around $5 million in fund balance reserves. Paying the shortfall dropped the fund balance to $3 million. If the surcharge income continues as now, 911 will spend all the fund balance two years before the bonds are paid in 2027.

The amount revenue varies each quarter, Swick said. “There’s no way to ensure we get payment from companies at this point.”

Swick took the county population and projected 85% had a phone. With that number, the amount anticipated is still around $1 million short.

County staff determined the original surcharge by taking the 2020 surcharge collected by the 42 cents to determine the number of phone lines that paid. Staff then divided the bond amount by that number to come to the $2.96 monthly needed to pay off the bond.

Prior story Phone surcharge to increase for 911 upgrade

In 2022, the Federal Communication Commission reported only 37% of homes have landline phones, down from 78% in 2000.

Some phones now use Voice Over Internet Protocol and are not billed separately for phone service. Those numbers are hard to determine by location, according to the FCC.

Both reduced the number of billed phones in the county, but it appears impossible to tell how many.

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Chairman Keith Baker, the Coldwater city manager, said the issue would return to the entire board at its Sept. 13 meeting.

---Contact Don Reid: dReid@Gannett.com. 

This article originally appeared on Coldwater Daily Reporter: Phone surcharge won't pay off county bonds for radio upgrades