by Alex Brooks
On Monday, October 21, the Petersburgh Town Board held public hearings about overriding the 2% tax cap and about the Preliminary Town Budget, which currently contains a tax levy increase of 9.6%.
[private]The meeting began with a number of people saying they thought 9.6% is way too big a tax increase for a town like Petersburgh that is not very prosperous. It was pointed out that many homeowners in Petersburgh are on fixed incomes and even those who have a job may not get raises or may be asked to contribute more to their health insurance so their take home pay is level or declining. There was some tea party style rhetoric about governments expanding because it is easier to raise taxes than to exert discipline on spending. There were predictions that people would be moving away because taxes are too high, putting the Town in a worse financial position.
Sherry Kluck had a simpler question – why does Petersburgh have this large tax increase when neighboring towns of similar size and economic status are holding tax increases to 2% or less?
The answer has to do with the disappearance of the usual fund balance. Bookkeeper Charles Guntner has said that the Town typically has about a hundred thousand dollars in unspent funds left over at the end of the year and some portion of that is applied to offset the tax levy. But this year Guntner is estimating the Town will have only about $20,000 on hand until the tax money starts coming in in January, and all agree that with so little cash on hand, it would be imprudent to apply any of it to offset the tax levy. This puts the budget in a $100,000 deficit if spending and revenue were to be the same as last year. In other words, if the budget for expenditures were to be the same as last year, the Town would have to collect $100,000 more from the taxpayers to keep its budget in balance.
In fact, the budget as it stands now proposes to collect $63,000 more than last year, so the Board has already fixed over one third of the problem by the budget cutting it has already done.
So where did the fund balance go? The Town is expected to spend significantly more than it budgeted by the end of 2013. Town Supervisor Krahforst said that after bills are voted to be paid in the October meeting, the Highway budget will be overspent by about $8,000 so far, with over two months left in the year. Bookkeeper Charles Guntner said that the General fund budget has $109,000 in it before the October bills are paid. He said he expects the General Fund to be okay overall even though several funds within it are over budget. But, he said, the Highway budget will be significantly overspent.
After learning that most of the over budget spending will be in the Highway Fund, several in the audience asked about Town Board oversight of the Highway budget. Supervisor Krahforst said the Highway Superintendent is an elected official who manages his own budget and is accountable to the voters.
The primary problem is that a lot of roads in Town were badly washed out by an intense rainstorm at the end of May and it was such a localized storm that New York State and FEMA have not provided aid for repairs. Some of the cost was covered by devoting CHIPS money to the road rebuilding projects. The Town is seeking additional aid through the “Hazard Mitigation” program, but it is uncertain if any funding will come from that.
Highway Superintendent Ray Harrison hired Duane Goodermote, Sr. to replace eight culverts on Potter Hill Road and two on Puckertoot because it required a large trackhoe which the Town doesn’t have.
Highway Superintendent candidate Gene Kluck, who has been attending all the budget meetings, said again that he thinks the Highway Department could save a lot of money if it bought its gravel locally from O’Donovan’s pit instead of hauling gravel from Dailey’s in Hoosick. Superintendent Ray Harrison replied that he has been going up to Dailey’s to get “shot rock,” which is not available in Petersburgh. Harrison said he is trying to make the roads resistant to damage from future heavy rains by putting in larger culverts and reinforcing the ditches and the ends of culverts with the shot rock. The culverts, the gravel, the shot rock, the outside contractors and the Highway Department workers’ overtime add up to a lot of money when you are trying to fix a lot of damaged roads in a short period of time.
Where To Cut
Board Member Bill Seel agreed with the members of the audience who felt further budget cuts are needed. The Board passed a resolution by a unanimous vote to override the State imposed tax cap, but Seel said as he voted in favor of the override, “Aye, but not at 9%.” He asked if other Board members would be willing to make further cuts, and Board Member Duane Goodermote said he would be willing to consider it.
Seel said his approach has been to focus cuts on the General Fund, which has been growing a lot in recent years, rather than highway, which has not been raised much in recent years despite increasing costs for gravel, fuel, health insurance and machinery. This approach was strongly seconded by Dave Miller, who said he thought taking care of roads is the most essential thing the Town does and characterized a number of other elements of the budget as non-essential or “discretionary.” But even in this room full of people who came to demand a lower tax increase, there were defenders of the youth program, the library, the seniors and so on. As suggestions were made about where to cut, and the particular situation with each line in the budget was explained, it became apparent that all the easy cuts had already been made and trying to find another $25,000 of cuts to bring the tax levy to a level that people consider reasonable, was going to involve painful cuts. People began to talk of 3% or 5% across the board cuts, of taking a little bit from a lot of places. The trouble is, if you exempt the Highway Fund from cuts and you can’t cut salaries of elected officials because they have already been published and some parts of the budget are pretty much non-discretionary and you exempt things that have already been significantly cut, there isn’t much left.
At this point it was getting late. It was nearly 10:30 and the meeting had been going on for almost four hours. Seel suggested emailing proposed cuts back and forth among the Board members to see if they could agree on some additional budget cuts to bring the tax levy increase down to a more acceptable figure. Duane Goodermote agreed to that, and the Board agreed to reconvene on Monday, November 4, at 7 pm to finalize the budget.[/private]