×

Williamsport approves budget with tax hike

MARK NANCE/Sun-Gazette Williamsport Councilman Joel Henderson comments during the City Council meeting Thursday night.

City Council adopted $27.2 million 2019 budget Thursday with a tax increase of 0.75-mills.

It then set a tax rate of 15.47 mills, meaning a homeowner with a property assessed at $100,000 will be paying $1,547 a year in real estate tax, Council President Jonathan Williamson said.

The 0.75-mills equates to another $75 a year in a tax bill.

Mayor Gabriel J. Campana’s preliminary budget was for a 0.65-mill tax increase.

Campana asked for the department heads to cut 5 percent of their budgets, but that did not happen, according to William E. Nichols Jr., city finance director and general manager of River Valley Transit.

The budget consists of 87 percent personnel costs and 13 percent all other expenses, he said.

Pensions cost the city $4 million and are expected to increase by $500,000, he said. Health insurance costs also rose by 7 percent.

The city has reduced its police force by four officers, eliminated two codes positions and is having the general manager of streets and parks also do the work of the assistant general manager. The positions are not layoffs but are through attrition.

In addition to the tax millage increase, cuts in expenses were needed to bolster a low city reserve.

Council and the administration spent the night working together to find and add more than $100,000 that will go into the reserve.

Toward that end, $50,000 was put back into the reserve number because the city chose Gallagher as its sole insurance broker for liability and workers compensation insurance.

Additionally, Delta Development Group, a consulting firm that works closely with River Valley Transit, will receive $25,000 less for its work. Other savings were accounted for through not paying unemployment compensation due to no layoffs planned and cable contract services, Nichols said.

Assessing the budget, Nichols said the goal is to have $500,000 in reserve. Auditors have suggested the city have two months worth of operating expenses available, or $4 million in reserve.

Nichols said the budget consists of 87 percent personnel costs and 13 percent all other expenses.

“Each year we have been passing a crazy deficit budget,” Councilman Joel Henderson said. “We end up spending more than what we have because the budget says it.”

Henderson said what might have to happen in the years ahead is to have each department drop to the bottom line and then have department heads ask for transfers of funds when available.

The millage increase was a recommendation of a three-year financial plan.

“We tried to hold to the three year plan,” Henderson said.

The plan indicates a need for a 1.25 mill increase in the 2020 budget and a 0.75 mill tax increase in 2021.

It also indicates a cap put on expenditure increases at 2.5 percent, Nichols said.

“We’re at that point that there is not an easy answer to the question of how the city can reduce the 87 percent of personnel costs down … we have got to find a way to do that,” Councilman Randall J. Allison said.

NEWSLETTER

Today's breaking news and more in your inbox

I'm interested in (please check all that apply)
Are you a paying subscriber to the newspaper? *
   

COMMENTS

[vivafbcomment]

Starting at $4.62/week.

Subscribe Today