City Rescinds Cash Promises, Backs Off Botched Contract

DEPOE BAY — Still swimming in a sea of financial shocks, the Depoe Bay City Council on Sept. 1 rescinded promises of annual cash to the local fire district and municipal harbor, then pondered a way to back out of a bungled agreement for accounting software.

Spending brakes were applied in a variety of areas following revelations last month of magnanimous guarantees by the Depoe Bay Budget Committee, including a gift of $200,000 yearly to the Depoe Bay Fire District. The amount is in addition to a voter-approved 5-year levy last passed in 2024.

The free-spending committee also pledged $300,000 annually to the harbor budget, seen as a way to placate dock users over moorage hikes and the imposition of a head tax. The 11-member board is comprised of city councilors and citizens and oversees spending of the town’s $3.4 million general fund.

The disclosures of new city obligations came at an earlier meeting, on Aug. 11, when councilors — most newly-appointed — squirmed over a list of disbursements by the city administrator before she was placed on paid leave. Among them was a check to the City of Newport for $3,000 to support a lawsuit against ICE.

“That wasn’t my call — I didn’t agree with that at all,” Mayor Joe Cannon told the Beacon afterwards. “But I do think we should help the fire department. They’re stretched pretty thin doing a lot of rescues.”

The cost-cutting continued at Tuesday’s meeting as town elders:

• held off voting on two ordinances that would have made future distributions to fire and harbor compulsory;

• delayed renewing a $5,000 per month ad campaign with KATU-TV, agreeing instead to invite marketing proposals with an RFP — the first went unawarded without explanation, according to the interim administrator. Making the case for “more heads in beds,” Mayor Cannon called for “a real return” on state-mandated tourism promotion;

• put on ice a $5,400 per month contract with a grant-writing firm due to poor results — “zero” grants were delivered to the city last year, according to the discussion;

• pared-back yoga classes at the community center that tie-up the $125 day space. “When did we decide to subsidize that?” questioned a councilor of the events, sponsored by the Depoe Bay Parks & Recreation Commission;

• and looked for an escape hatch with a software company, Caselle Inc. that agreed to install new accounting software in 2021 at a cost of $48,269, including training. The city paid a $24,135 deposit but never responded to the company’s numerous emails and now faces a four-day deadline and “relatively significant” fees, according to city staff.

• agreed to slow-walk repairs to the city-owned fish plant after reversing an earlier decision to sell the harbor facility, restored in the 1970s with a Dept. of Agriculture grant. The council agreed to button-up the plant until it comes up with a plan for its future.

“We need to revamp the budget process,” said Cannon, later. “We should have our own CPA, make audits our Number One priority and get back the respect our city council should have.”