The U.S. Air Force will pay $17 million to reimburse the city for most of the cost of a water treatment plant built in 2013.
The settlement agreement was several years in the works before it was approved Tuesday by the Tucson City Council.
Tucson Water spent around $20 million to build the plant, which uses hydrogen peroxide and ultra-violet light reactors to break down 1,4 dioxane, a contaminant from World War II-era aircraft manufacturing.
Tucson Water spokesman Fernando Molina declined to discuss the cost of operating the plant, because further negotiations will take place to determine whether or how much the Air Force should pay for the ongoing operations.
Budget also OKโd
In other action, the council tentatively approved a $964 million city operating budget for fiscal year 2017, which begins July 1. The approval sets a cap on spending, although some changes inside that limit still could be made before the final approval in June.
The budget eliminates 256 full-time equivalent jobs from the city payroll, mostly through retirements and attrition.
The budget also begins to rebuild the cityโs general-fund balance, said City Manager Michael Ortega. The depletion of the โrainy dayโ fund was affecting the cityโs bond ratings and interest rates.
The budget also includes:
- A $2 increase to the hotel room tax to raise $3.7 million;
- A half-percent increase in the public utility tax, which is what utility companies pay the city, to raise $2.9 million;
- And a small property tax rate increase, which will cost about 33 cents a year for the average $150,000 home, to raise $400,000.
