Mayor James Sottile’s proposed 2012 budget contains no layoffs and achieves a tax levy increase of less than 1 percent, but only by tapping $1.2 million from the city’s fund balance.
The proposed budget, which must be approved by the Common Council totals $36.5 million, up 2.2 percent from 2011. But the amount to be raised by taxes remains unchanged at $14.8 million. The amount of taxes to be raised from the city’s residential properties will rise by 0.67 percent while the commercial sector’s share of the tax levy will fall by 0.72 percent. Tax rates, meanwhile, will rise by 11.3 percent with homestead properties paying $7.09 per $1,000 of assessed value while non-homestead properties will be taxed at a rate of $14.37.
Sottile, submitting his last budget as mayor, said the tax rate increase reflected an 11.7 percent decline is the assessed value of all city properties. (The city assessor’s office instituted an across-the-board cut in assessments as part of the 2011 revaluation).
Sottile said the tax levy freeze comes despite an increase of $844,000 in mandated expenses, including hikes health insurance costs, payments to the state retirement system and debt service.
To offset those and other projected spending increases, Sottile has proposed using $1.2 million of the city’s unreserved fund balance. That will leave $1.3 million remaining in the city’s cash reserves. Services and personnel will remain mostly unchanged with the exception of the transfer of five laborers currently assigned to the Department of Parks and Recreation. DPW will assume responsibility for maintenance at city parks. Sottile backed off a plan to municipal trash pickup — which would have saved about $700,000 — in the face of strong public outcry.
The proposed spending plan makes good on Sottile’s stated intention to bring in a budget in compliance with the new state mandated 2 percent property tax increase cap. But, Sottile said, he was disturbed by the use of reserve funds, something he had chided the Common Council for in the past, to push down the tax levy.
“It’s extremely scary, but these are unprecedented times,” said Sottile. “Without mandate relief we don’t have a choice.”
Image: Mayor Sottile discusses the 2012 budget at a City Hall press conference Thursday morning. (Photo by Dan Barton)
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