Borough staff begins budget creation, no drastic changes
Borough Manager Steve Giesbrecht forecasted a “status quo” budget to the borough assembly last Monday.
“It’s a status quo budget meaning we’re not changing services,” Giesbrecht said. “We’re not going to offer more services. We’re not going to offer less services. We don’t expect to have to make major changes to mill rates or sales tax rates.”
The budget assumptions offer a guideline for department heads as they begin creating their fiscal year 2015 budgets.
In the FY 2015 budget, $200,000 is being transferred to a Property Development Fund—a new fund designed to capture depreciation in order to pay for capital projects such as building repairs.
The budget also gives additional monies to the harbor for capital projects and uses $50,000 less in offset funds from secure rural schools revenue—the borough’s capital fund for school projects.
The general fund will also reduce its Assisted Living subsidy by $50,000.
“It’s a good thing,” Giesbrecht said. “They’ve been so successful we’re finding we have to give them less money to keep them in the black.”
The changes mean the borough needs an additional $250,000 in revenue or cuts in expenses to balance the general fund—a figure Giesbrecht expects the borough to recoup after its coffers receive additional property tax revenue after borough formation.
Assembly member Bob Lynn asked if there’s been discussion about fixing the inequities of taxation in service areas such as Frederick Point since many places in the new borough don’t have regular access to the services the borough provides.
“Not yet,” Giesbrecht said. “We have not put those assumptions in here though we could.”
Lynn also asked about significant changes in revenue. Giesbrecht said there won’t be tremendous changes in revenue but health care costs and a new union contract have the potential to significantly increase expenditures.
Jody Tow, finance director, said the sales tax ordinance review committee will be looking at the possibility of taxing alcohol and tobacco for an increase in revenues.
“The more sales tax we bring in, the less property taxes we’ll have to bring in,” Tow said.
Mayor Mark Jensen said he’s heard concern from multiple citizens about increasing road maintenance.
“What’s been conveyed to me is they’d like to see the equipment on the roads more,” Jensen said. “If you just have to burn more diesel to have the grader on the road…it might be worth looking into to make people happier.”
Karl Hagerman, public works director, said it might be a tall order with current staffing.
“If we had more staff to allocate somebody specifically just to road maintenance, filling potholes, sign straightening that kind of thing, it would probably improve,” Hagerman said. “I’m sure it would…We can try to include that in the budget.”
Hagerman said he’ll play with numbers to see what that budget might look like.
Assembly member Kurt Wohlhueter asked if the borough could sell more land to increase property tax revenue.
Leo Luczak, community development director, said because most of the lots don’t have road, water and sewer access, they would likely be sold at a loss.
Budgets are due from department heads by March 15 and budget work sessions will be scheduled in April. The assembly will conduct its first reading of the FY 2015 budget on