City Manager Releases Draft 2010 Budget

Proposals Calls For Deep Spending Cuts, Still Raises Tax Rate

City Manager Chuck Strome has released his draft 2010 budget. You can read Mr. Strome’s entire draft budget, including its introductory message, here. The draft budget reflects the impact of the exceptionally difficult economic climate on New Rochelle. In order to limit expenditures and control the tax burden, the City has:

• Cut our workforce by more than thirty positions through attrition and consolidation;
• Drastically scaled-back our already anemic capital budget;
• Cut or deferred a variety of desirable, but non-essential, programs;
• Sought, with mixed success, revenue alternatives to the property tax;
• Utilized, to the maximum degree possible, outside assistance and grants to fund local infrastructure and service priorities.

In the draft 2010 budget, the City Manager proposes to:

• Further reduce our workforce by some ten to twelve positions;
• Freeze salaries for all employees not currently in the midst of a contract cycle;
• Draw down our fund balance to a level below that typically endorsed by municipal finance experts.
• Continue pursuing revenue alternatives, including possible State adjustment of the utility gross receipts tax.

These actions collectively represent a sustained and aggressive effort to rein in costs, and they will yield savings in the millions. Unfortunately, these savings are simultaneously outweighed by other factors that negatively impact our budget, including reductions in sales and mortgage tax revenue and substantially higher pension costs — factors outside of local control or short-term influence. For these reasons, the Manager has also proposed a property tax increase of 8.9%. (Because this applies only to the City portion of the property tax bill, the increase relative to one’s total property taxes would be 1.5% or $257 dollars per year for the average taxpayer.)

I am keenly aware of the high level of financial discontent in our community and region. As both a municipal leader and a taxpayer myself, I am distressed by the prospect of any increase in the local tax rate. Regrettably, our choices are limited.

We could not mathematically hold taxes level without firing a significant number of Police officers and fire fighters (these departments are, by far, our primary expense). Such personnel reductions would come on top of the reduced staffing levels already achieved through attrition. In addition to the impact on the particular employees involved, this step would compromise our capacity to ensure a safe city, and I do not believe it would be supported by a majority of our residents.

The City Council will discuss the budget proposal in the weeks ahead and hold a public hearing on December 1st. It is quite possible that changes will be made prior to the budget’s adoption, and I am confident that every member of Council will be focused intently on austerity measures that befit the economic climate. Certainly, if you have any constructive recommendations, I will be grateful for your input.

New Rochelle is not alone. Families, businesses, and governments everywhere are finding that the economy leaves us with few good options. I will do my very best, in a transparent and candid fashion, to make the choices that best serve our community’s interests and future.