It appears Mayor Lee Rothenberg doesn’t have enough commissioners on his side to adopt the town’s maximum millage rate of 1.6 mills later this month.
But Rothenberg will continue to make his point until the budget is adopted at the end of the month.
The mayor hopes that commissioners will raise the millage rate from 1.5 mills to 1.6 mills to ensure that the town’s level of service does not decrease.
And, Rothenberg says only a minimal increase in taxes is needed to bolster reserves in the event money is needed for an emergency situation.
But even after Town Manager Bruce St. Denis admitted that the level of service would be “somewhat adversely affected” if the commission approves the recommended budget’s millage rate of 1.4952 mills, several commissioners voiced their continued support for a lower millage rate at a Thursday, Aug. 27 special budget workshop.
Commissioners Gene Jaleski, Peter O’Connor, Robert Siekmann and Jim Brown were more interested in discussing how the budget, as proposed, would affect that level of service.
When St. Denis explained that another vacant police officer position will not be filled for the second year in a row, Brown seemed okay with that.
“Given the circumstances we are living in, we may be able to live with a little bit of a loss in service.” Brown said.
And Jaleski continued to urge town staff to look for more ways to cut costs before recommending a higher millage rate.
“I’m not convinced that we cannot find places to save more money,” said Jaleski, who urged St. Denis to cut consultant costs and to keep police and fire vehicles instead of replacing them.
Vice Mayor Robert Siekmann also urged the town to cut costs, recommending the town do away with a $100,000 red-tide contingency for beach cleanup.
Siekmann also warned the rest of the commission that the recommended budget, as proposed, will result in a deficit for a third, consecutive year because $400,000 in commission contingency funds and $100,000 for red-tide cleanup is being taken directly from the town’s reserves, which is anticipated to be $4.7 million at the start of the new fiscal year next month.
“I suggest to you that we will have another deficit next year of about 500,000 unless we figure out a way to cut costs, raise revenues or spend reserves,” said Siekmann, who also worried that the building department would be unable to make its annual payment of $287,000 for a second, consecutive year.
St. Denis told the commission that adopting a 1.6 millage rate would generate an additional $500,000 that could be used next year to address another anticipated fiscal year of property-value declines and an additional $1 million in pension costs.
If the millage is not raised this year, St. Denis anticipates the town will have to raise the millage rate to 1.75 mills in fiscal year 2010-11.
But commissioners were more interested in talking about the minimum level of reserves the town should keep.
Even Key resident and former mayor Ron Johnson joined the discussion.
“Four million is more than adequate for reserves,” said Johnson, who suggested the town could borrow money if a serious storm were to hit the island. “Let’s hold the line.”
While Siekmann and O’Connor expressed a desire to set a minimum cap for a reserve, the decision could not be made at a special meeting.
And O’Connor referenced the recommended balanced budget that St. Denis presented last month.
“I think we should go with the manager’s recommendation,” O’Connor said.
Rothenberg was disappointed with the discussion.
“We are hanging on by a hair,” Rothenberg said. “We can handle this year, but next year could very well be a disaster without some long-term planning.”
The Town Commission gave no further direction on the budget as proposed and will vote on a millage rate and the budget itself on first reading and public hearing at 7 p.m. Monday, Sept. 14. The budget will be adopted on second reading at 5:01 p.m. Tuesday, Sept. 29.
To see a list of the town's budget reductions, please click on the link below: