Oak Harbor voters may be asked to raise their own taxes to fund city services.

Mayor Patty Cohen floated the idea during a “state of the city” address in front of a packed crowd at the Greater Oak Harbor Chamber of Commerce luncheon Thursday.

Cohen gave the audience a rundown of all the work the city does for the community, from maintaining 67 miles of streets, to collecting 8,400 tons of garbage a year, to solving crimes and much more. She announced that the city’s 50-year-old wastewater treatment plant was just awarded by the state as an “Outstanding Wastewater Treatment Plant.”

The mayor heaped effusive praise on city employees. “This is a dynamic group of professionals dedicated to going the extra mile for you,” she said.

Nonetheless, Cohen said a growing gap between city revenues and costs has led to the delay of maintenance, equipment purchases and facility needs.

The problem is that the city can only increase the amount of property taxes — a major source of general fund revenues — by just 1 percent without a vote of the people. Together with other money the city collects, revenues are growing by 2.5 to 3 percent annually.

“Unfortunately, inflation and mandated costs are increasing approximately 5 percent annually, leaving a 2 percent funding gap,” she said.

The mayor pointed out that the city employed 135 full-time workers in 2000; in the beginning of 2007, the city employed only 133 full-time employees. During that time the population, she said, grew by 3,000 people.

“We cannot continue to deliver quality municipal services if our responsibilities are expanding and our funding options collapsing,” she said.

Cohen claimed the cause of the funding problems is state tax policies. While the state enjoys over a billion dollars in surplus, cities are struggling to make ends meet.

The solution for Oak Harbor, she said, is either doing away with services or asking voters to raise taxes.

“You have to tell us what to cut,” she said. “In order to address the funding gap mentioned earlier, part of the Council strategy may involve securing additional taxing authority through local voter approval.”

On a lighter note, Cohen proposed a new plan to make the city marina a more attractive place for average city residents. She admitted that there’s nothing to draw those who don’t own a boat to come to the facility.

“That’s not right. Think about how the addition of shops, restaurant, recreation, and new retail could redefine the east side of the Harbor. It’s ours, let’s go for it,” she said. “I really believe this community is no longer wedded to status-quo culture. We are stepping out.”

The mayor only briefly mentioned the other $92 million in plans for capital facilities that remain unfunded, undone and unprioritized.

Cohen ended with a challenge to the citizens to become more engaged.

“In summary, I offer you a city in a good state and a community with a remarkable future,” she said. “However, our successful future depends on how artful we choose to be. We need to be deliberate — thoughtful decision makers locking onto united, doable board actions.”

You can reach News-Times reporter Jessie Stensland at jstensland@whidbeynewstimes.com or call 675-6611.