VERGENNES — As they moved on Tuesday toward a 2.5-cent increase in the city’s municipal tax rate, Vergennes aldermen received good news from City Manager Mel Hawley — the city’s year-end fund balance will be larger than he first expected.
Hawley said some numbers could still move a little bit, but he told aldermen the fund balance — the cash carry-over from the city’s fiscal year, which will end on June 30 — would be enough to allow aldermen to use it to keep the tax rate in check.
“I’m very confident we should be well over $100,000 in a fund balance,” Hawley said at Tuesday’s city council meeting.
Aldermen used $118,000 of a larger fund balance to offset taxes a year ago, and a comparable figure this year now appears realistic, officials said on Tuesday.
Aldermen will meet on June 30 to make final the city budget and the municipal tax rate, not including school taxes. By the city charter, they must meet a June 30 deadline to do so. The Vergennes fiscal year runs from July 1 to June 30, and aldermen, not residents, have the final say on spending.
Hawley on Tuesday presented the council with a $2,104,942 general fund budget (exclusive of sewer, which is paid by user fees) for fiscal year 2015-2016; it was a figure he had lowered from his original May budget draft. It represents an increase of about $17,000 over 2014-2015 spending. The tax increase is due, at least in part, to a decline in the city’s grand list.
Hawley said his plan was to offer a budget that would allow aldermen to meet their objective of no more than a 2.5-cent increase in the municipal rate, which would then land at 75 cents. That rate does not include school spending.
“My goal was to get you a budget that gets you to 75 cents,” he said.
A 2.5-cent increase translates to $25 per $100,000 of assessed value.
The latest available school tax estimates called for a 6.6-cent residential property tax increase, meaning homeowners could be looking at an additional $91 per $100,000 of assessed value. Homeowners eligible for prebates will receive some of the school tax money back in 2016.
Within his budget, Hawley proposed:
• $365,132 for the general administration budget, including City Hall salaries and benefits, maintenance and supplies. Hawley made several cuts to reach that number, including $10,000 to his assistant’s salary and another $10,000 to City Hall maintenance, which he said could be made up by using the Water Tower Fund and other sources.
He also suggested reducing the website line item from $2,000 to $200, but aldermen at the suggestion of council members Jeff Fritz and Renny Perry and Mayor Bill Benton agreed to increase that amount to $3,000 in order to improve what they said was an inadequate website.
• $760,903 for police, a figure what would represent an increase of $13,000 over current spending, despite some major reductions made by Hawley to Chief George Merkel’s initial requests.
The most significant of those cuts was a decision not to replace a cruiser during the upcoming fiscal year. Aldermen asked about that move, but Hawley said the department’s fleet had been assessed and found to be in good condition. The consensus was that the force would need a new vehicle in 2016.
The major increase came in a new $29,000 computer server that Hawley said the department badly needs.
After some discussion and a look at the latest figures, aldermen also increased a revenue line item in the police budget: They boosted Hawley’s $60,000 estimate for police fine collection to $65,000. That number is still far short of the $90,000 estimate included in the 2014-2015 budget.
• $748,957 for public works, a decrease of about $2,200 achieved largely by savings in medical insurance costs.
• $196,271 in general expenses, including an increase in recycling costs.
Andy Kirkaldy may be reached at [email protected].