Ocean View Town Council members on Tuesday, March 11, adopted the town’s budget for the 2009 fiscal year on a 3-2 vote. Mayor Gary Meredith and Councilmen Roy Thomas and Richard Nippes voted in favor of what had been cast as a “difficult budget in a difficult budget year.” Councilmen Bill Wichmann and Norman Amendt voted in opposition.
Wichmann has cited his opposition to the now-adopted budget in the context of the $300,000 allotted to the town’s construction of a new Public Works building. Wichmann has steadfastly supported a previously estimated $1.4 million plan for the new space and has opposed suggested cuts to its scope as not able to produce the “right” building for the growing town.
He was one of two members of the town’s Long Range Financial Planning Committee (LRFPC) to vote in opposition to the recommended budget during the committee’s final considerations a few weeks ago.
Amendt said Tuesday that he would not vote in support of the budget because he had not had a chance to fully review it, having received the latest set of documents related to the budget only that day.
“I can’t vote for something I know nothing about,” he said.
A memo from Town Manager Conway Gregory dated March 5, detailing the process of arriving at the recommended budget, basic figures included therein and future considerations, was placed in council members’ town hall mailboxes on March 6, according to Finance Director Lee Brubaker, with a final document presented to them at the start of the March 11 special meeting that still reflected earlier recommendations from the LRFPC.
“It has been available for some time,” Mayor Gary Meredith noted.
Amendt added that he objected to having the budget prepared by the LRFPC, which he said was supposed to have its focus on long-range planning and not yearly budgeting.
Gregory highlighted elements of the budget and his March 5 memo to the council at the start of Tuesday’s meeting, noting that the budget had come about through a “team effort” involving meetings with departmental heads and four meetings of the LRFPC between November of 2007 and March of 2008.
As a key element, the budget adopted March 11 still includes Town Manager Conway Gregory’s self-described “sunny skies” forecast on revenue in a continuing slow real estate market that has the town about $100,000 short in transfer tax revenues from their 2008 budget figures with about six weeks left in the fiscal year.
Gregory has repeatedly said that the budget situation will need to be monitored closely over the coming six months to a year, with possible adjustments and cuts in the future if revenue does not meet the forecast.
Along with the budget for the coming fiscal year, council members adopted in the same vote a required five-year capital plan for the town, running through the 2013 fiscal year.
Gregory noted as key that the plan calls for a 4 percent increase in non-capital costs over the course of those five years in each of the town’s departments. He also pointed to the town’s $925 million tax base, based on assessments as of Feb. 1, 2008, with a tax rate of 9.81 cents per $100 of assessed value.
The budget calls for some $907,000 in real estate-related tax revenues in the 2009 fiscal year, with 3 percent increases planned for each of the fiscal years from 2010 through 2013 — that comes out to about $30,000 more each of those years, he said.
“It’s a major concern,” Gregory acknowledged of the transfer tax revenue. “We continue to have a great reliance on it.”
“It may necessitate some changes,” he added, suggesting mid-year budget cuts might be needed if revenues didn’t meet budgeted numbers.
Wichmann raises concerns over police budget
Before voting in opposition to adopting the proposed budget, Wichmann said he also objected to the way in which it had been developed.
“My concern is that I prefer various departments to come together and say, ‘This is what I need,’ and the finance department to come with, ‘This is what we have,’ and to work together to make a balanced budget.”
Wichmann said he also considered cuts to the overtime budget of the police department to be unbalanced, with a 20 percent cut in the number of hours included in the budget accompanying only a 1.4 percent increase in gross wages and cuts in their uniform budget.
“Overall, the police department’s only up 3.7 percent,” he said, “and we were shooting for 4 percent.” He said total town numbers for overtime were up 10.7 percent, while the police departments’ overtime was being reduced 20 percent.
Thomas said his own concern with the budget was over the possibility that transfer tax revenue might continue to go down. A $100,000 shortfall for the current fiscal year takes the town back down to levels seen last in 2000 and 2001, down $150,000 from the prior year.
“I would like to believe we’re at the bottom of the curve,” he said, adding that in a time of shortages, he believed a “top-down” budget in which a finite amount of revenue was divided among departments worked better than Wichmann’s recommendation of a bottom-up budget where departments came forward with their needs first.
“Everybody got their fair share. Everybody has increased,” Thomas emphasized. “We have growth under control.”
The bottom line, he said, was, “The budget cuts allow the citizens to receive the services they’re used to.”
In response to Wichmann’s concerns about the police overtime budget, Meredith noted some $75,000 in contingency funds that can be used across all town departments, if needed. He said the unpredictability of activities such as attending court meant that the appropriate police overtime budget wasn’t easy to determine.
“The overtime dollars might be a little unrealistic,” he admitted.
Meredith also pointed to other areas where those unallocated funds might need to be used, such as the costs to hook up town properties to the new central water system – mandated for all town properties by the end of February 2009 and, for town-owned properties, not specifically included in the budget.
“There are things we’re going to have to spend money on that aren’t in here,” he said.
Thomas pointed out that that was one reason the council had decided to go with a new kind of budget ordinance this year – a line-item adoption. With the line-item budget, the town can come back later to add or remove funding from a given project without having to amend the budget as a whole.
Nippes pronounced himself “satisfied” with the budget before casting his vote in favor of its adoption.
White recommends changes to salaries, fees
Objections were heard Tuesday night, however, from Savannah’s Landing resident and District 3 council candidate Susan White, who recommended the council consider removing salary increases for the town manager, finance director and administrative office that had been accepted by the council on the basis of Gregory’s recent salary study.
The salary increases had been made in lieu of the previous policy of paying overtime hours to the officials, running about $35,000 total for the three positions in overtime in the last year and the same in the new salary increases when all three went to salary-only pay.
White said wanted a more objective salary study done and that she felt the money could instead be used to hire an additional employee to help them with their duties, as well as to possibly alleviate any cost for any additional police overtime hours.
The council candidate also had objections to the town manager’s use of a town car and town-paid fuel costs for his commute to and from his home in Denton, Md. She encouraged the council to look at the perk and at ways in which its expense to the town might be reduced.
White also looked for additional revenue sources in the budget, suggesting the idea of a town fuel tax might be investigated if a proposed gas station project were to be approved, as well as encouraging the town to aim for more than $2,400 in net revenue from its central water system once its 20-year debt on construction costs is paid.
Thomas objected to the latter notion, noting that the intent was to run the water system as a non-profit with revenue only aimed to cover expenses and create a long-term reserve for maintenance and other needs. Increasing “profit,” he said, would not sit well with the system’s users – the town’s residents – who would themselves have to pay a higher water rate to create that revenue.
“You can’t take revenue from people paying the water bills and then use it for general expenses,” he emphasized before the council concluded its budget business on Tuesday night with the 3-2 vote to adopt both the 2009-fiscal-year budget and the five-year capital plan.
Council members also voted Tuesday to cancel their planned March 18 council workshop, and Meredith reminded those in attendance about the planned March 19 candidates’ night, at which the four candidates for the District 3 seat and two candidates for mayor will be able to speak to potential voters.
Amendt is yielding his seat representing District 3 after reaching term limitations of two three-year terms.