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After 117 years, will Gold Hill remain a city?

GOLD HILL — At least one departing city official says disincorporation makes financial sense for this cash-strapped town, while former council members who are returning to office in January warn that the option would not resolve existing financial woes.

Interim City Manager Dale Shaddox said the rumor mill in the one-square-mile town shifted into overdrive after state officials threatened steep fines related to almost two decades of infractions at the city's failing wastewater treatment plant.

Built in the 1980s, the city's treatment plant is releasing unacceptable levels of suspended solids into the Rogue River after operating 10 years longer than designed without needed upgrades.

Plant replacement is estimated to cost between $10 million and $12 million, and design and project planning must be put in place immediately to avoid state-sanctioned penalties.

With fewer than 450 customers connected to the system, rates could increase by as much as $50 or $100 a month unless city officials set up a plan to spread out costs.

That prospect has some talking about ending Gold Hill's status as an incorporated city. The City Council is scheduled to discuss the idea in a meeting Monday, but there are no actions planned.

Council President Sam Blake, who lost his bid for reelection in November, said disincorporating the 117-year-old town would alleviate costs for plant replacement if Gold Hill tapped into a neighboring system or created a wider customer base to pay for repairs.

Under state law, a city can disincorporate only if it is debt-free and the decision is approved by the city's registered voters.

Blake said, financially, the city has less debt now than in decades past and that disincorporation could bring fiscal relief.

"I think it's something that definitely needs to be put out there as an option," Blake said. "The city can disincorporate and everything will fall under the county and then it would get spread out in a bigger footprint.

"If you become part of the county, they can take the sewer towards Rogue River and Sams Valley for more customers, or there's the option of closing it down and piping our sewage to White City."

Blake added, "There are a lot of options you could look at before rushing into a $12 million project and taking everybody's water rates up $50-$100. And we haven't even talked about the water treatment plant that needs replacement, too."

Mayor-elect Jan Fish, who was out of town this week but responded briefly by phone, said disincorporation is not a solution.

"I don't see how it's even a possibility. We have to take care of (the wastewater treatment facility) one way or another," Fish said.

Incoming Councilor Gus Wolf, who spent two decades in city government before taking two years off in 2010, is also opposed to disincorporation.

"We were incorporated in 1895 and we're not going anywhere as far as I'm concerned. We can't throw the whole town away over a higher sewer bill," said Wolf.

"It's not insurmountable and we wouldn't be paying any less to be part of the county. Honestly, we'd probably end up paying more from what I know of Jackson County.

"We have too much of a future to just decide we won't be a city anymore," Wolf added. "We've got a good council coming in. We've got (Shaddox) until April and some good candidates for that job and we're in sunny Southern Oregon. Things could be worse."

Shaddox said a decision to disincorporate would not do away with the financial responsibility of residents to pay for infrastructure and services.

"My part of the discussion on Monday would be to remind everybody that disincorporation is not really a solution with anything to do with our obligations as a community for water or wastewater or any other service," Shaddox said.

"The same projects will still be facing us with the same costs, whether we're incorporated as a city or as part of the county. We decided to just put it on the agenda for discussion, but it's just a discussion at this point and I'll be an interested listener, just like everybody else on Monday night."

Councilwoman Christine Alford, who is leaving office this month, said Friday she would make a motion to have the discussion of disincorporation removed from the meeting agenda.

Alford said council members had been told by Shaddox that the topic of disincorporation was "a non-starter" but that the council was divided over the matter.

The council meeting will take place at 6 p.m. Monday at City Hall, 420 Sixth Ave.

Buffy Pollock is a freelance reporter living in Medford. E-mail her at buffyp76@yahoo.com.