Speed camera revenues are expected to be dramatically lower, in part because cameras at New Hampshire and Carroll will be affected by the bridge projects. In addition, the budget factors in no new revenue from the 'safe speed' zones approved by Council for University and the northern reach of New Hampshire. This may be overly conservative. A different way to approach it would be to assume that these two cameras would be active for 50% of the fiscal year and would earn revenue equal to the lowest revenue camera in the city.
Property valuation throughout the city decreased by $72 million (3.6%) which, if the tax rate is left the same, will result in a decrease of $276,000 in property tax revenue from last year. No increase in the city's property tax rate is proposed in the draft budget so the City's taxation of residents is not proposed to increase but that doesn't mean that the County might not increase the tax rate for the County budget (over which we have no control).
In FY13, Council planned to begin the year with $8.43 million in the general fund and end with $8.9 million. Instead, we expect to end FY13 with $10.6 million. This is the $1.6 million 'surplus' that you remember from earlier council discussion and my updates. Former Councilmember Snipper often raised questions about how much General fund balance we need to carry from year to year. The current draft budget proposes ending our year with an $8.7 million balance. I believe that would be unfair to you, with whom we discussed and generally agreed we should provide some form of rebate based on that surplus. We found out that we cannot provide a rebate (a state Attorney General opinion I provided a few months ago) but we could lower the tax rate. One option would be to lower the tax rate so that we end up with a General Fund balance where we began FY13 - i.e. $8.32 million. That would allow us to provide property tax relief of approximately $410,000.
Related to the above, the draft budget proposes putting $1.3 million into an equipment replacement reserve (for example, a rainy day fund to use to replace police cars, or trash trucks, etc.) Doing so would grow the expected balance of this fund by approximately $600,000. By putting a smaller amount into that reserve, we could potential put more money into paying down remaining city debt, reducing unfunded pension liabilities or providing more property tax relief or for other purposes.
Many residents have spoken to Council about sustainability initiative over the last few years. Rather than seeing an increase in the sustainability budget in the year when we will have a sustainability action plan from our consultant, Brendle Group, the budget proposes to drop sustainability support to $190,000. I do not support this.
The budget includes slightly increased funding for grants, continued support for home repair assistance for lower income residents, property tax relief assistance for lower income residents, support for festivals, July 4th celebration, Crossroads Community Food Network, and $100,000 of additional pension fund contributions to reduce our pension liabilities.
The current draft and many past budget documents can be found on this page. Comments to me and your testimony on Monday would be extremely welcome.