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Boston Heights Overlook
Not an official public document by, of or for
the Village of Boston Heights OH.
|
Boston Heights Overlook |
This is a publication of
Boston Heights Overlook.
Not an official public document by, of or for the Village of Boston Heights OH. |
VILLAGE OF BOSTON HEIGHTS
45 E. Boston Mills Road
Hudson, OH 44236
COUNCIL FINANCE COMMITTEE SPECIAL MEETING - July 20, 2004 - 7:00 P.M.
[These are your Editor's notes on this special meeting of the Finance Committee, not official minutes of that meeting. If you feel that any of your statements have been misrepresented here, please contact us.]
Links: Revised Budget Proposal - Revenue Comparison
BROUGHT TO ORDER
The meeting was brought to order at 7PM. All council members were present: Bill Goncy (President Pro Tempore), Mike Cheung, Jim Hudson, Annette Miller, Janet Miller, Paul Palumbo. Also present: Mayor Ray McFall, Clerk-Treasurer Carol Zeman, & Deputy Solicitor Ed Muse.
Clerk-Treasurer Carol Zeman explained that this meeting was called to deal with the Village's shortfall in actual and expected income, coupled with increasing costs: income is off by $33,000 from this point last year. Once it is known that the budget cannot be met, the Village is required by law to project its costs and income, make the necessary adjustments, and recertify its budget to Summit County.
Mrs. Doris Beaufait, of 220 W. Hines Hill Road, sparred with Mrs. Zeman over the audibility of her report. After a certain amount of acrimony, Council President Bill Goncy called for order.
Mrs. Zeman presented a plan to meet the budget shortfall:
- The Police Department had been asked to find $38,400 in savings through the end of the
year.
- The Road Department would cut the hours of two workers, from 40 to 32 hours and from 24 to
16 hours per week, saving $5,400.
- The Clerk of Courts (Maryann Bode) would reduce her hours and give up part of her health
coverage, saving $1,100.
- A $5,000 contingency fund for road salt, which had not been used in recent years, would be
eliminated.
- The Professional Fees fund, which pays mainly for major project engineering, would be cut
from to $15,000 for a savings of $20,000. No major projects are in the offing for the
rest of the year.
- The Building Department budget would be reduced from $14,000 to $10,000, for a $4,000
savings.
- Cleaning of the Village Hall would be reduced to once per week for a savings of $700.
Mrs. Zeman's proposal totalled $74,565 in savings (but see below the revised proposal). Council would have to agree to make the changes to appropriations, and recertify the budget to the County.
Councilor Mike Cheung asked how this would affect the cash carryover at the end of the year. Mrs. Zeman said that this was hard to estimate before October.
Mr. Aurel Dzur, of 235 W. Hines Hill Road, asked about the causes of the shortfall: reduced revenue, or overspending? Mrs. Zeman replied that revenues were much below earlier estimates. She added that the State has cut, and continues to cut, the "local government funds" that it pays from state revenues. Council President Bill Goncy noted that other communities are also experiencing layoffs and budget cuts. Mrs. Zeman added the other area communities are revising their budgets for these same reasons.
Mrs. Zeman noted that one large shortfall is in the hotel tax, as travel business has been much reduced since the 9/11 attacks. She added that local business activity is down, and the Village has lost several businesses including Mahen Machinery and Ohio Rollform, both of which went out of business this year.
She further noted that admissions taxes were down due to low turnout at the golf course; weather has been bad this summer. (This probably applies to the Hudson Swim Club as well.) The admissions tax normally brings in about $20,000 a year.
Mayor Ray McFall added that there was no warning of those businesses closing; someone else pointed out that Bridal Connection had also closed, and that the State had bought their building (for the Route 8 project).
Mr. Ronald Dick, of 225 W. Hines Hill Road, asked if the City of Hudson had passed their 2% income tax last fall, and how that impacted the Village. Mrs. Zeman replied that when she had looked into the same issue with regard to the Twinsburg Township JEDD, RITA had told her that it would take a full year to establish that number.
Mr. Dick asked, in view of the future changes to Route 8, where new business could be established in the village. There was a side discussion on the configuration of the future interchange at Route 8 and Hines Hill and Boston Mills Roads. Mayor McFall noted that the County was considering a marginal road between Hines Hill and Twinsburg Roads, but would have to find the funds, and that there were significant bridging and wetlands issues. He added that there is a meeting on this project on 29 July.
Mrs. Zeman pointed out that she had looked into reduction of the income tax credit (currently 100% of tax paid by residents to other communities). Eliminating the credit would offer a much smaller return to the Village than an increase to of the 1.5% income tax rate to 2%. An increase would bring in more than $130,000 per year.
In response to a question from Mr. Dzur, Mrs. Zeman stated that the total Village budget for 2004 is $1.19 million. This is what must be reduced by over $74,000.
Police Chief Joe Varga discussed the reduced police coverage that would be required to meet the proposed new budget. Currently there are always two officers on the road; he would be forced to reduce that to one officer at some hours of each night. The Chief is usually working in the office on warrants and paperwork but would have to return to road duty instead.
Mr. Dzur asked when the projected savings would take effect. Mrs. Zeman replied: by September. He asked whether this represented about a 5% budget cut, suggesting that this would be relatively easy to accomplish. Councilor Mike Cheung agreed that this was roughly correct. Mr. Dzur wanted to engage in a discussion about future business growth in the Village.
Mrs. Beaufait stated that she was looking for "more transparency" from the Village government. She asked for current Village pay rates, specifically payments made to the Solicitor, and wanted them produced immediately. Mrs. Zeman went to get those figures from the office. She reported that in 2003 the Village paid the Solicitor $46,809 -- not $70,000 as had been suggested. Mrs. Beaufait asked why the Village paid the Solicitor hourly and not via a retainer. Mrs. Zeman stated that even when a city has its Solicitor on a retainer there is still an hourly fee involved. It was also mentioned that Solicitor Pry had cut his firm's hourly rate to $60 for the time being.
Mr. Vince May, of 7965 Olde Eight Road, asked how quickly the Village must respond to the budget shortfall. Mrs. Zeman said that the village must make immediate adjustments to its appropriations and certify them to the County.
Mrs. Jane Robinson, of 7747 Olde Eight Road, asked whether this budget shortfall could have been foreseen before now. Mrs. Zeman thought not: many large mid-year payments are made in May (such as Workers' Compensation), and revenues had unexpectedly not picked up since then. Mrs. Robinson asked how often income tax revenues are received from RITA. Mrs. Zeman said statements are received monthly, but fluctuations are very large across the year.
Mrs. Zeman stated that the Village had implemented new computerized financial reporting to Council, which had delayed fiscal reports until recently. These were now up to date.
Mrs. Zeman stated that the Village's revenue stream is on a "downhill slide", which was not clear earlier in the year.
Councilor Jim Hudson mentioned that a budget crunch was mentioned during planning for last year's extensive road repairs. Council had had to consider the tradeoffs in borrowing against future Road Levy funds to make more permanent repairs and save on future maintenance.
Mrs. Robinson said that an income tax increase to 2% was necessary. Councilor Hudson did not understand why the income tax increase did not pass (last November and last March); he himself pays almost 3% to the City of Euclid.
Mr. May asked whether the police could write more tickets to produce more income. There was some uncomfortable laughter at this question; the Mayor jokingly noted that he "did not hear that". (The Village has a long-standing reputation as a speed trap.) Councilor Hudson stated that "we are not a ticket based economy", and that court costs and fines are already down. There was some discussion of the relationship between police officer coverage and ticket revenue.
Councilor Hudson asked why office workers could not be cut instead of police officers. Mrs. Zeman said that the Clerk of Courts would be cutting some hours, but that most of that department's budget comes from other funds (the so-called "Computer Fund"), not the General Fund.
Councilor Hudson said he was willing to forgo his Council salary for the remainder of the year if that would help the budget. The audience applauded this offer. Councilor Janet Miller concurred with his offer.
Mrs. Robinson pointed out many people don't actually pay their traffic tickets.
An unidentified citizen asked what a single officer would do for backup. Chief Varga replied that he would call an adjacent community for help -- for example, Hudson or Peninsula -- under a mutual aid agreement. He added that this could not be relied upon to support permanent understaffing.
Mr. Curtis Bartner (?), of Walters Road in Hudson, noted that (in his view) only Boston Heights police patrolled his road, even though he lives in the City of Hudson. He was concerned about officer safety as well.
Mr. May asked how quickly additional funds could be realized. The answer from Council was that an income tax increase could appear again on the November 2004 ballot, to take effect in 2005. Mrs. Zeman cautioned that only 60% of that additional income would actually be realized in the first year. (This is because corporations would pay the old rate on their net 2004 profits reported in 2005.)
Mrs. Zeman pointed out that, contrary to popular belief, only a small portion of property taxes go to the Village. She exhibited a pie chart to this effect. (Figures show that only 7-10% of property taxes go to the Village; the rest goes to the County and the Village's three school districts.)
Mrs. Zeman also pointed out that a large part of the Village is in the Cuyahoga Valley National Park, which pays no property taxes at all, and only pays $70 per year as PILT (Payment In Lieu of Taxes).
Councilor Paul Palumbo stated the Council's Safety 1 Committee had recently discussed increasing court costs (for traffic tickets, etc.). He also pointed out that last year's rezoning was intended to increase business opportunities in the Village.
Mr. Dzur asked about other revenue streams that might be available to the Village. Councilor Mike Cheung pointed out that the Village must now make allocations based on current events; long-term or retroactive strategies would not help the current situation.
Dr. Cheung also mentioned at that "if police are off limits" then overall cuts are more nearly 10% than 5%. He also pointed out that salaries for Village officials cannot (by state law) be cut during a term. He added that officials can voluntarily donate their salary back to the Village; even if all of Council members did that, it would only amount to about $7,000 saved this year.
Regarding the earlier question about traffic ticketing: Mrs. Zeman mentioned that state law restricts the percentage of income the Village may receive from traffic tickets -- she thought it was around 30%.
Mrs. Cindy Palumbo, of 7224 Olde Eight Road, (wife of Councilor Paul Palumbo) asked what ideas Council had come up with in advance of this meeting. She also asked what the police department thought about its proposed budget cuts.
Chief Varga stated that he is upset, and his officers were upset, about the underfunding and reduced hours. He thought his department might lose officers in the long term, due to the reduced hours. An unidentified citizen asked whether too much money is spent on training, and not enough on salaries, because of high turnover in the department. Chief Varga noted that it costs up to $3,000 per hire to train new officers above and beyond their academy training; they then must supply their own uniforms, weapons, etc.
Councilor Jim Hudson asked about collection on outstanding warrants. Police Chief Varga said that there were about 400 warrants pending, but in recent years the department has had many complex cases, with investigations that increasingly tied up his manpower.
Mrs. Lisa Varga, of 7240 Olde Eight Road, (wife of Chief Varga) complained that the Clerk-Treasurer and Council were conducting a sidebar discussion during the Chief's summary, rather than listening. She thought this discourteous. She suggested cutting administrative rather than police funding.
Mrs. Marge Donley of 7683 Olde Eight Road, said that she did not have an immediate solution to the budget problems, but suggested a Police Levy in November. There was some applause in the audience. Councilor Paul Palumbo said this had idea been discussed, but even the Chief thought "it would never pass".
Councilor Janet Miller felt that "safety comes first" and was concerned about the criminal elements finding out that police coverage had been reduced in the Village. She felt that the budget crisis should have been made clear earlier in year.
Mrs. Teri Slane, of 110 Slane's Lane, "completely agreed" and thought that police budget should be the last to be cut -- perhaps cut a little, but not as much as had been proposed.
Mrs. Slane, citing her past tenure as a Council member, made a number of suggestions:
better administrative enforcement to collect more permit fees owed to the Village; bring
payroll accounting back in-house rather than outsourcing; bring clerical typing of
Council minutes in-house rather than outsourcing; reduced Park mowing; consider whether
the Fire Department's new First Responder system is paying too many people to show up
at any given incident; reduce Village Hall cleaning; cut administrative costs.
Councilor Jim Hudson suggested that the Village could bill the Cemetery and Park Funds for maintenance to those areas, rather than paying for this with general funds.
Mrs. Zeman said that payroll outsourcing costs about $200 a month, totaling about $3,600 per year with the additional work at year-end. She pointed out that the Clerk-Treasurer's assistant made only $4,700 last year and receive no healthcare benefits.
Councilor Paul Palumbo asked who would support a police levy over income tax increase. Police Chief Varga thought that there would be too much competition with other levies, and said that an income tax had been seen as the best option -- but it did not pass.
Fire Chief Jim Robinson seemed irate about the remarks made about the First Responder program. He pointed out that of a $60,000 per year budget he has "no control over 50%" (e.g. dispatch, hydrant maintenance). He felt that the Fire Department had been unfairly financed with respect to other departments: no raises for 11 years, " flat-lined" budget for 6 years; much-needed officers not being replaced. He pointed out that $82,000 had been paid to Macedonia for EMS service in 2003. He compared his flat budget to rising police and service department budgets, and pointed out that his was the last (entirely) volunteer fire department in the County.
Mrs. Slane confirmed her respect for the Fire Department, but pointed out that the department does have a separate equipment levy -- and the Police Department does not. She asked whether the Fire Levy should be partially shared with the police. She also thought that a Fire Department building addition should not be considered at this time. Chief Robinson pointed out that it had taken five tries to get the Fire Levy in the first place, that the department still has aged equipment and is "10 years behind other departments" in the area. He added that no Fire Levy money goes to personnel.
Mr. Dick asked for the Village's plan for economic growth. Councilor Cheung recapped the zoning changes of last year, explaining that they had been several years in discussion and planning. He gave the reasons for the rejection of the recent rezoning request for high-density housing and large box retail, pointing out that this would have represented a huge increase in the Village's residential population and a severe impact on an existing residential neighborhood.
Mr. Dick stated that residents in the way of commercial development should just "get used to more change". (It was not clear whether he was including changes that would adversely impact the Hines Hill neighborhoods.)
Mr. May observed that "we go through this... every five years or so", and that the solution might be a continuing levy for all safety services. Councilor Janet Miller seemed to endorse this idea, stating that even if that were "hard to pass" it should still be attempted, with a clear explanation of the future trade-offs if it fails.
Councilor Cheung pointed out once again that long-term strategies will not preclude the need for current adjustments to the budget. He asked Mrs. Zeman and Mr. Jim Robinson (wearing his other hat of Street Commissioner) about a Streets Department line item called "Contractual Services". That was budgeted for $25,000, while only $5,500 of that had been spent so far. In Dr. Cheung's view even if that were more than doubled through the end of the year, perhaps $10,000 could still be pulled from that item.
There some discussion as to what exactly was covered by this line item: Mrs. Zeman said that the Streets Department "Contractual Services" are never used to fix the roads, and that some of this is for utility costs. She thought however that this adjustment was a viable alternative to some of the police department cuts.
Regarding Chief Robinson's earlier remarks about EMS costs: Mrs. Zeman stated that the Village had paid Macedonia $47,000 for EMS services in 2003, net of receipts. After some discussion, it was established that Chief Robinson's $82,000 figure also included additional money that Macedonia received from insurance companies, and represented the total cost of 2003 EMS service within the Village. The Chief's remarks on this seemed to be tending toward the idea that the Village could institute its own EMS service for a similar cost.
A unidentified Village police officer said that if Chief Varga is not tracking warrants and handling department paperwork, then overall revenue will be reduced and department operation will be adversely effected. Councilor Mike Cheung said the Council does not "micromanage the police department" and that the exact method of budget cutting is up to the Chief. He admitted that Council did concur with the chief's initial budget cutting plan.
Mr. May asked for a statement on what is needed to establish the Village's long-term financial stability. Mayor Ray McFall replied: increase the income tax. Mrs. Donley asked whether the income tax increase could be put on the November 2004 ballot; the answer was: "Yes".
Council President Bill Goncy reiterated that Council did consider a Safety Levy last year, and decided that the income tax increase was more viable at the ballot box. Dr. Cheung pointed out that 75% of Village income taxes are paid by workers in the Village, and 25% by residents. He contrasted this with a levy collected from property taxes, paid entirely by Village property owners and residents.
Mr. Dick endorsed an increase of the income tax to 2%. He thought that this was comparable to the rate charged by most nearby communities.
Council President Goncy suggested residents support an income tax increase and promote it to their neighbors. Councilor Palumbo noted again that an income tax increase had twice failed at the ballot. Mr. Goncy asked who would support a Safety Levy instead -- many in the audience raised their hands. Chief Varga felt that an income tax increase "had to pass". He complained that no one was present from the Ashbrooke West or Wooded View neighborhoods, as "they would have been if this meeting were about their roads".
Mrs. Jane Robinson also thought the income tax should be put on the ballot in November 2004. She complained that she and Mrs. Donley had had no help from citizens during promotion of the earlier income tax ballot issues. Chief Robinson said that Fire Department staff would be willing to help, and he thought that Chief Varga could say the same about his police officers. Mrs. Robinson asked for new volunteers for promotion of an income tax increase on the November ballot.
Mrs. Zeman said that she would incorporate Dr. Cheung's idea to reduce "Contractual Services" by $10,000, which could then be applied to the police budget.
Councilor Jim Hudson reiterated his offer to donate his Council salary; Dr. Cheung suggested that if all Council members were to agree to this reduction it would save an additional $7,000. Mrs. Zeman added that she must receive letters to this effect from each council member, since the the village could not reduce those salaries. She would present the consolidated budget adjustments to Council's regular Finance Committee meeting next week, for consideration at the August Council meeting. (See below the revised proposal.)
Chief Varga calculated that, with these adjustments, single-officer coverage could be limited to part of a single night per week. Dr. Cheung added, optimistically, that some of the necessary cuts could yet be restored if the economy turns around. With that the meeting adjourned.
ADJOURN
REVISED BUDGETARY PROPOSAL
(21 July 2004) Clerk-Treasurer Carol Zeman informs us that more detailed calculations indicate a net savings of $6,137 from Council members donating back their remaining salary for 2004. In conjunction with the additional savings from the Streets Department budget, the required savings from the Police Department is reduced from $38,400 to $22,300. This appears to be equivalent to a restoration of about 34 officer-hours per week.
Mrs. Zeman supplied the following figures (as revised per the above discussions):
| POLICE DEPARTMENT COST SAVINGS | ||||||||
| Hourly Rate | Hours Worked | Cost | Employer Pension | Employer Medicare | Savings | Pay Periods in 2004 | ||
| Fulltime Officer | 17.66 | 80.00 | 1,412.80 | 275.50 | 20.49 | 1,708.78 | 18,796.60 | |
| Auxiliary Officer | 10.82 | 80.00 | 865.60 | 117.29 | 12.55 | 995.44 | 10,949.83 | |
| Average Savings with only 2 officers from 7 am - 3 pm | 14,873.21 | |||||||
| Auxiliary Officer | 10.82 | 150.00 | 1,623.00 | 219.91 | 23.53 | 1,866.45 | 20,530.92 | |
| Savings on Hospitalization | 3,011.84 | |||||||
| Savings on Hospitalization with 25% payment to employee | ||||||||
| Estimated total savings thru year end | 38,415.97 | |||||||
| Reduction in cost savings due to council pay/10,000 from street dept. | 16,137.46 | |||||||
| Total savings to year end | 22,278.51 | |||||||
| STREET DEPARTMENT COST SAVINGS | ||||||||
| Hourly Rate | Hours Worked | Cost | Employer Pension | Employer Medicare | Savings | Pay Periods in 2004 | ||
| Part Time Laborer | 8.50 | 32.00 | 272.00 | 36.86 | 3.94 | 312.80 | 2,502.40 | |
| Part Time Laborer | 10.82 | 16.00 | 173.12 | 23.46 | 2.51 | 199.09 | 2,189.97 | |
| Gross Wage | 4,692.36 | |||||||
| Employer Pension Portion | 635.81 | |||||||
| Employer Medicare Portion | 68.04 | |||||||
| Total Savings to Year End | 5,396.21 | |||||||
| Additional Cost Savings from Contractual Services | 10,000.00 | |||||||
| Total Savings to Year End (Revised) | 15,396.21 | |||||||
| CLERK OF COURTS COST SAVINGS | ||||||||
| Hospitalization | 547.05 | |||||||
| Overtime from Clerk of Courts (change in hours) | 518.43 | |||||||
| Total | 1,065.48 | |||||||
| Reduce Snow & Ice Account in General to 0 | 5,000.00 | |||||||
| Reduce Professional Services to 15,000.00 | 20,000.00 | |||||||
| Reduce Building/Elec. to 10,000.00 | 4,000.00 | |||||||
| Reduce Cleaning to once a week | 687.50 | |||||||
| Council pay give back to year end | 6,137.46 | |||||||
| TOTAL ESTIMATED SAVINGS | 74,565.16 | |||||||
REVENUE DATA
(22 July 2004) Clerk-Treasurer Carol Zeman supplied the following figures (w/ our grand totals):
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