I was in Duluth last weekend and the local news headlines were all about the $6.5 million City budget deficit mess, at a level that’s attracting statewide coverage (MPR last week, Strib this week).
Now it’s Northfield’s turn!
City Finance Director Kathleen ‘Mac’ McBride did a budget Powerpoint presentation (PDF) at the Council work session on Monday. I created a Flash version:
See today’s Nfld News: Cuts from ’09 city budget take $500,000.
A large number of the cuts, proposed Monday by city Finance Director Kathleen McBride, affect personnel, including eliminating five positions, reducing some staffers’ hours and outsourcing custodial services. A part-time rental inspector position budgeted in 2008, which hasn’t been filled, will also be eliminated. Partial wage freezes for higher level employees will also be implemented. The city’s fire and police departments also take significant hits, said McBride, reducing maintenance and professional services.
And it’s likely to get worse:
And if that’s not difficult enough, McBride expects the 2010 and 2011 to be more difficult to balance. It’s anticipated that property values may shrink, further reducing any potential tax increases, and there are fears the state, facing a budget crisis of its own, may look to cut aid to cities. McBride called the cuts for 2009 “quiet,” meaning the impact will be felt by city staff. Any future cuts, she said, would impact the city’s service to the public.
I see the Council plans to transfer $25,000 from the technology fund and another $56,000 from city savings.
I think that former City Administrator Al Roder at one point suggested that there would be no effect on the budget from the (Rate Search) missing millions.
It would seem that if we’re drawing from reserves to cover the budget, wouldn’t having another $2.5 million be helpful?
Griff –
First, let me once again praise “Mac” for trying to bring information forward to the public. Although ultimately the decisions effecting all of us will be made by our elected officials, personally I believe that an informed citizenry helps to build a stronger democracy.
Second, I greatly appreciate her efforts to address the issue through a combination of steps, including streamlining operations at city hall. I’m glad that there isn’t just a simple “raise taxes” answer.
However, as I asked back when Mac was the guest on our radio show, what is the whole picture and what does it mean for me? Perhaps more clearly, what is the total annual financial impact on the average citizens, Steve and Stacey Sixpack?
The tax increase to cover the deficit was about $50 on a $250,000 home. When Mac discussed the CIP, I believe that she said we could get the whole $50 million package for an extra $295 a year on a $200,000 home, or approximately $355 on a $250,000 home.
Some of that $50 million we could choose, or ask our elected officials to choose, not to do right now. However, Mac indicated that some of the work, such as the road projects, are already in the pipeline. I suppose the City Hall project, unless the petition is successful, would also be included.
So I’m not sure whether we’re already at a $405 or $227.50 tax increase for next year. As I said on the show, I guess my opinion on the projected increase depends what I’m getting for my $300.
Then there is the business park. Brian O’Connell, Rick Estenson, and Frank Dunbar all made clear last week that it’s almost certain that the citizens of Northfield will be paying for the infrastructure.
Dunbar also estimated that the first 250 acres, all that he’s recommending the city pursue for the immediate future, would cost about $7 million. This is just for the infrastructure on the site and does not include the $7 to 8 million estimated by the former city engineer to bring the infrastructure from our existing network to the site. Nor does it include, as I understand it, any of the roads and related infrastructure, necessary to make the property “shovel ready”.
Brian O’Connell suggested that he would recommend adding this cost to citizens’ water and sewer bills instead of their taxes. Again, what’s the annual financial impact for Mr. and Mrs. Sixpack?
Finally, Mac suggested that there is likely to be another shoe dropping. The State’s decision on Local Government Aid will also impact the City of Northfield. I’ve got to imagine that there is at least a range of estimates on what that amount could be and its effect on Steve and Stacey’s budget.
Perhaps all of these figures should be on the table at the same time. Hopefully it’s not just the Sixpacks’ dining room table but also the Council’s work table. Perhaps some of the decisions not too far down the pipeline will be reconsidered in light of the big financial picture.
– Ross