Council looks for budget savings

Members brainstorm ways to avoid tax rise

April 23, 2003|By Athima Chansanchai | Athima Chansanchai,SUN STAFF

Already reviewing more than $2 million in suggested cuts and previously overlooked money sources that would balance next year's proposed $21.3 million budget without a tax increase, Westminster lawmakers are looking at further trims to give the city a cushion for the following year's spending plan.

The Common Council's president said the time might have arrived to reduce the amount of money in the city's "rainy day" fund, and one of his colleagues said the city might be better off starting a line of credit. Another questioned whether computer equipment should be leased, rather than bought.

And when Councilman Roy L. Chiavacci asked when water rates were last increased in the city, others on the panel said the idea of raising those rates might be worth looking at.

The suggestions went no further than the brainstorming stage but seemed to indicate that council members are prepared to look for additional ways to trim city spending.

"We're home free, for now, but for the 2005 budget we may need to make some tough choices," said Finance Director Joseph D. Urban.

To spare Westminster residents a tax increase, Urban's department proposed a budget that included cuts - and previously undiscovered sources of money - to close a $700,000 deficit that remained after department heads made spending proposals that included $1.8 million in reduced spending.

Those cuts included delays in public works projects such as road repairs, new city office buildings, new children's play areas and street equipment replacement. The Westminster City Playground took the biggest hit, with almost $600,000 taken away from a project to upgrade a retaining wall, concession stands and bleachers.

Urban said city staffers then combed through dusty records to find more than $200,000 left from completed capital projects. They used the same approach to find another $92,000 in capital equipment reserves. Then they discovered $125,000 carried over from this year's budget specifically targeted for the Police Department's adoption of a new retirement plan, the Law Enforcement Officers Pension System, or LEOPS. The city took $100,000 from the emergency reserves - its rainy day account - lowering the minimum amount to $400,000 from $500,000. It also is saving $158,000 by deferring purchases of cars and other equipment.

In a presentation to the council Monday night that featured chirping birds, whistling trains and ringing cash registers as a soundtrack to PowerPoint slides, Urban laid out the financial landscape for the fiscal year starting July 1. But he warned that the ways city officials are choosing to plug the deficit this year are one-time-only solutions.

He highlighted areas that might provide future revenue. The city took in $228,000 in one-time fees charged to new developments. It also reaped a $200,000 increase in property tax revenues - not because of last year's tax rate increase, but because the base grew.

The city will need revenue like that to pay for a new deferred compensation program for city employees, who are not eligible for LEOPS. They will be given an opportunity to participate in a 401(a) program, the government version of a 401(k) in which the city will contribute 2 percent.

Other expenses for next year are: completion of the three-mile Wakefield Valley Community Trail, Union Street Community Center, two downtown parking garages at the Longwell lot and at Westminster Square and the emergency water connection to Medford Quarry. Many of these projects are being paid for through loans and grants.

Council members used the two-hour meeting Monday as an opportunity to ask Urban questions and make suggestions.

Council President Damian L. Halstad brought up the idea of further lowering the minimum balance of the city's rainy day fund.

"You don't want to hoard taxpayer money," he said. "We have to find the lowest amount that's prudently possible."

Chiavacci suggested starting a line of credit instead.

Councilman Robert P. Wack suggested another way to save money might be to lease computer equipment instead of buying.

"Computers change so fast, there's no need to buy them," he said.

When asked why the city always chose to purchase the equipment instead of leasing, Assistant City Treasurer Dale A. Taylor said, "That's the way we've always done it. We've paid as we go."

Taylor also answered questions from Chiavacci about the water user rate, which is $18.60 for a minimum of 6,000 gallons for city customers and $23.30 for customers outside city limits, said Thomas B. Beyard, director of the city's Planning and Public Works Department. He said the last time the rate was increased was in 2000, and no plans are in the proposed budget to raise it.

Though Urban will formally introduce the budget at Monday's council meeting, he said it will be a work in progress until its adoption May 12. He said the city is awaiting final numbers on county, state and federal grants as well as state rebates for adopting LEOPS, which could affect the budget. Residents may offer comments and ask questions at a hearing May 5.

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