Town Manager Bruce St. Denis asks the question every year of the Longboat Key Town Commission.
Should the upcoming budget for the town reflect the existing service level and, therefore, expenses, or should the expenses and, consequently, level of service be driven by fluctuations in property values?
The answer — for the second year in a row — is to stick with the service-level status quo.
“I think it’s clear we don’t want to reduce the level of service,” said Mayor Lee Rothenberg.
As much as possible, anyway.
That’s because two days before the town manager asked the question, he laid off three employees in the Planning, Zoning and Building Department.
Administrative Assistant Angie Harmon and planners Butch Powell and Belton Wall were made aware of the decision Tuesday, May 19.
Combined, the three employees’ salaries cost the town $155,375.80.
But, after factoring medical-insurance costs and pension contributions, Finance Director Tom Kelley said the layoffs will save the town approximately $200,000 in the 2009-10 budget.
While the decision will help the town make up its anticipated $1 million shortfall in next year’s budget (losses in town revenue as a result of declining property values), building official Randy Fowler said the loss of two planners will affect the building department's level of service.
But, in the meantime, St. Denis said it’s the right move.
“A lack of overall activity in the department was the reason for the decision,” St. Denis said.
Although the commission came to a consensus for town staff to craft a budget that maintains service levels at its Thursday, May 21 regular workshop, the decision also means the millage rate will be increased to help produce the same amount of revenue compared to last year.
Last year, the Town Commission adopted a millage rate of 1.5 mills, an increase of 6.7% over the previous rate of 1.4062 mills. One mill is equal to $1 for every $1,000 of assessed valuation.
The higher millage rate marked the first time in eight years the Town Commission had increased the town’s property-tax rates.
And although the commission understands the millage rate will be raised somewhat to maintain revenue, it is not willing to accept the decision that more cannot be done to cut costs.
St. Denis assuaged the commission’s concerns by explaining that town staff has already reduced liability and health-insurance coverage costs, decreased worker-compensation costs and reduced cell-phone-plan costs, which will save the town hundreds of thousands of dollars.
Replacing aging police cars with infrastructure surtax monies and finding grants for police and fire-marine operations also saved money in the town’s current fiscal year, which ends Sept. 30.
“I can assure you that we haven’t stopped looking for ways to reduce costs and will continue to do so,” St. Denis said.
Commissioner George Spoll suggested the town think outside the box to increase revenues.
“We have outstanding departments and could offer our services to other barrier-island communities for a rate of return,” Spoll said.
St. Denis said he would talk to other barrier-island communities about the possibility of them using some of the town’s services, such as the Planning, Zoning and Building Department.
The Town Commission also gave consensus for the town manager to move forward with an early-retirement incentive for which 17 employees qualify.
Finance Director Tom Kelley reports that four of the 17 eligible employees are interested in the proposal, which would result in approximately $190,000 in town savings.
The fiscal year 2009-10 preliminary budget and the preliminary property assessments from the Manatee and Sarasota County property appraisers’ offices will be released Monday, June 1.
St. Denis received permission to offer the program to employees as soon as possible, with the hopes that some may retire before the new fiscal-year budget begins Oct. 1.
Said St. Denis: “I think we can come in with a budget that’s close, with an expenditure rate closer or even lower than last year’s budget, which requires a rollback millage rate to maintain revenues and a relatively small transfer from the commission contingency.”
TRIMMING THE FAT
Town Manager Bruce St. Denis told the Town Commission that expenses in the following categories have been reduced in the past six months to achieve a balanced fiscal year 2009-10 budget:
• Liability insurance
• Health insurance
• Power costs associated with re-lamping town facilities
• Cell-phone costs reduced through a new program
• Police and fire-marine operations costs through grants
• Workmen’s compensation costs from new rates
• Comprehensive Plan changes being made completely in-house
• Police cars purchased with infrastructure surtax monies
• Computer-system enhancements, including a new budget-preparation module, which increases departmental productivity