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BudgetUnified Government Administrator Dennis Hays presented a budget that does not raise the mill levy on July 15 to the Unified Government Commission. (Staff photo)
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UG budget meetingReginald Lindsey Jr., Unified Government budget director, on July 15 told the Unified Government Commission that the proposed budget for 2014 would be $296 million. It is considered to be a "status quo" budget, where the property tax rate remains the same. (Staff photo)
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BudgetReginald Lindsey Jr., Unified Government budget director, on July 15 told the Unified Government Commission that the proposed budget for 2014 would be $296 million. It is considered to be a "status quo" budget, where the property tax rate remains the same. (Staff photo)
UG budget meeting
Unified Government Administrator Dennis Hays on July 15 called a proposed 2014 budget that maintains the same property tax levy rate “challenging.”
There will be no property tax rate increase, UG officials said. The proposed city-county rate is the same at 81.6 mills.
Hays proposed maintaining the same mill levy rate in a budget message July 15 to the Unified Government Commission at City Hall. He also proposed raising the payment-in-lieu-of-taxes (PILOT) fee on Board of Public Utilities bills by 1 percent, from 10.9 percent to 11.9 percent in 2014, which would raise about $3 million in revenue.
Then, a transfer of $3 million from the sewer system fund, which is currently close to $33 million, to the city general fund would provide more revenue for the 2014 budget, he said.
UG budget manager Reginald Lindsey Jr. said the proposed budget was $296.8 million for the city and county during 2014. The city budget is increasing $8 million, partly because retirement fund (KPERS) rates are going up, he said. The UG will keep public safety as a priority. Public safety is the major expenditure in the budget, Lindsey said.
“The proposed 2014 budget represents a crossroads for the Unified Government,” Hays told the commission. It’s a point where the UG knows there’s revenue ahead, but it’s not quite there yet.
He said the UG had the choice of taking a very conservative path that would have included furloughs and layoffs of employees, or at the other extreme, to spend the future money coming in. Some other cities in Kansas are either making drastic employee cuts or raising taxes, he said.
He said he chose a “middle-of-the-road path,” that would maintain current services and the tax levy for 2014.
“It’s still painful,” Hays remarked after the meeting. “There’s nothing easy about this.”
While there is some money coming in from the new developments in Wyandotte County, the UG looks for much more to come in a few years from now.
The UG Commission will be asked to approve the maximum mill levy at its 5 p.m. meeting July 18.
Doug Bach, deputy UG administrator, said the UG would resume reducing staffing by attrition in the proposed budget. Also, the UG would reduce overtime, he said.
Departments would take a 5 percent operating cost cut under the proposed budget. Capital projects also would be reduced.
The budget also includes a 2 percent pay bonus effective July 1, 2014, he said.
Under the proposed budget, the UG will close the Recycling Center at the Park Drive facility, while maintaining curbside recycling.
The proposed budget would reject the Police Department application for a Department of Justice grant for additional officers, as the future obligations would be too much, according to Bach.
The Sheriff’s Department application for a grant would go forward, because it is a 100 percent grant.
The budget also does not fund the Fire Department’s cadet program. But it does fund 20 firefighter positions that previously were funded by a federal grant.
The proposed budget would restore Neighborhood Business Revitalization funding levels to the former $27,500, and move it to the Neighborhood Resource Center.
The budget will increase trash collection fees $1.50 a month because of contract increases. Also going up are sanitary sewer fees, by 5 percent, because of federal mandates.
The budget also upgrades the 311 Call Center; sets aside $50,000 for broadcasting UG meetings beginning July 2014; adds $400,000 to increase resurfacing of streets; funds operations at the Piper Community Center; increases UG transit funding by $550,000 in 2013 and $450,000 in 2014; maintains the new home building fee waiver; and moves the Land Bank into the Economic Development Department to market vacant land.
There also was no funding for two proposed offender re-entry programs in this budget. More budget details are posted on the UG’s website, www.wycokck.org.
While there had been discussion of eliminating the BPU PILOT fee and replacing it with a fund transfer, the BPU board asked that the PILOT not be eliminated at this time, according to UG officials. The UG had started to lower it from its former 12.8 percent rate, and it went down to 10.9 percent, but the current proposal increases it 1 percent. BPU Board President David Alvey said the economy has not turned around enough yet, and that BPU sales had been projected to be better at this time, but were not turned around yet. Other local governments and utilities are experiencing tough times as well.
The commission had set goals of tax relief, better service, better capital funding, more compensation for employees, more fire trucks and police cars, and restoring the fund balance to years past. While all those goals were not possible this year, they will be possible in the future, Hays said.
He mentioned that in another year or two the UG may see more funds from casino revenues, more funds coming in as the sales tax revenue bonds at Village West are paid off, and more funds coming in from land revenues from the Cerner project. However, all those funds are not here yet.
The influx of money from STAR bonds is expected to come in for the budget year 2017; more casino revenues are expected to come in during 2015; and tax revenues from Cerner may be another year away.
Lew Levin, UG chief financial officer, stated that the UG faced challenges such as a declining local tax base led by declining property taxes. Added to that are increasing health care costs, increasing pension and wage expenses, and cuts to federal and state aid, he said.
UG officials cited the loss of $115 million since 2006 in machinery and equipment tax revenues. The tax was eliminated by the state Legislature.
They also cited the loss of funding from the Local Ad Valorem Tax Reduction Fund, a loss of at least $30 million over time from state funding cuts.
In addition, the assessed value decline since 2008 has cost the UG about $60 million, officials estimated.
While there are signs of economic recovery, the economy hasn’t completely recovered yet, Levin said. There are positive trends for Wyandotte County, including stabilization of the population base, an increase in single-family housing starts this year, and large construction projects currently going on.
Foreclosure rates have started to stabilize as well, which is a good sign for the local economy, according to Levin. Tax delinquency rates have decreased from 9 percent to 7 percent. Retail sales were up 3 percent outside Village West and had increased in double digits at Village West, he said.
Assessed valuation numbers were generally constant this year and there was hope for an increase in the future, he said.
Hays said the UG was in a good financial position and had been able to maintain its credit rating.