Mayor and Council Budget Workshop – May 5, 2016

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MAYOR AND COUNCIL

BUDGET WORKSHOP

MAY 5, 2016

Mayor Cerino called the budget workshop to order at 6:00 p.m. In attendance were Council members Liz Gross, Linda C. Kuiper, Samuel T. Shoge and Mauritz Stetson, W. S. Ingersoll, Town Manager, Amanda Miller, Accounting Treasury Specialist, Jennifer Mulligan, Town Clerk and guests.

Mr. Ingersoll stated that thanks to Ms. Amanda Miller and Ms. Brenda Leaf of CBIZ the budget is organized and the figures were coming together. He explained the revenues and expenses in detail.

Mr. Ingersoll stated that he assumed the northeast annexation would be completed in this upcoming budget year, which resulted in $15,000,000 of newly accessible property, or an additional $12,000.00 into the coffers.

Ms. Kuiper stated that Kent County received a windfall from the income taxes last year and the money was held back in case the State wanted it back. She asked if the Town could receive an estimate from the County on what the Town could expect.  Mr. Ingersoll stated that the Town has a good indicator what it will receive, noting that the County held money back as a result of the Wynne Case.   He said that the State of Maryland had people pay Maryland Income taxes for money they made in other states and it was declared unconstitutional and the monies are being returned to the taxpayers.

Mr. Stetson stated that in order to get some extra revenue he thought letters should go to all the innkeepers and hotels advising them that if they do not pay the Hotel Tax they could not advertise on the Town’s website, at the very minimum. Ms. Kuiper stated that right now some of the establishments, such as Airbnb, were difficult to track because they were not registered.  Mr. Stetson stated that he thought some of the Bed & Breakfast establishments were not paying the tax.  Mr. Ingersoll stated that the County was the only authority that could collect the hotel tax and he thought they should do occasional random audits to make sure the hotels were paying the tax annually.

Mr. Ingersoll stated that he has $350,000.00 listed under sale of assets, which included the old police station building and five (5) lots on College Avenue and Lynchburg Street. He said that all the properties were listed with realtors. Mr. Ingersoll stated that if the property and lots were not sold, the capital work connected with that money would not be performed.    He said that he would like to clear $275,000.00 for the police department and each of the lots was priced at $15,000.00 for qualified low and moderate income families.  If a developer came in to buy the lot, the cost would be $25,000.00 per lot.

Mr. Ingersoll stated that there was not much in the budget for new construction and subdivision fees. There was nothing included for the tax differential, although it would be nice to have that assistance back from the County.  Mr. Ingersoll stated that the Council could arrange an annual meeting with the Commissioners to discuss the tax differential.

Mr. Ingersoll stated that the different departments have their budget based on a 3% mid-point raise. Health insurance costs had a small decrease.  Ms. Kuiper asked if the Town could go in on the County’s health insurance.  Ms. Miller stated that she did not think the Town could combine with the County but they did consult with the same firm and the numbers came in higher than were quoted through Chesapeake Benefits.

Ms. Gross asked on what basis a 3% increase was included. She said that Social Security received no increase this year and the COLA increase for 2017 was 0%.  Ms. Miller stated that the mid-point figure was used from the compensation study.  Mr. Ingersoll stated that he thought the employees deserved a raise for their hard work.  Ms. Gross stated that she did not think that the cost of living has gone up; although she said she thought some employees deserved a merit increase.

Ms. Gross asked what savings would go to the employees from the savings in health insurance. Ms. Miller stated that the savings was going back to the Town since it was the Town that was subsidizing a good deal of the additional costs for all those family groupings beyond individuals.

Mr. Ingersoll said he would produce a calculation based on 1%, 2%, and 3% increases and compare the differences. Mr. Ingersoll stated that the overall costs affected separate budgets.  Ms. Gross stated that last year the cost of living increase was 1.7% and a 2.5% increase was given to employees. Ms. Gross suggested comparing raises with the State of Maryland. Mr. Ingersoll stated that there should be something done to incentivise employees.

Mr. Stetson stated that he had “steps” implemented at the police department when he was the Chief. He said that it was an incentive for the employees to work harder.  Mr. Shoge noted that the office employees who took over the financial responsibilities did get a raise this year.

Ms. Kuiper asked if the street superintendent position has been filled. Mr. Ingersoll stated that he was leaning towards splitting the job between different departments and elevating employees from within.  Ms. Kuiper asked how many vacant positions were in roads and maintenance.  Mr. Ingersoll stated that he would not want to try to run the street crew with any less support than was in place already, noting that the employees did need to be motivated by good leadership over in the street department.

Ms. Gross stated that the budget looked good, but the principle of the matter was that there were people in the country not receiving cost of living increases.

Mr. Ingersoll stated that the Marina was doing well outside of the debt service. Mr. Ingersoll stated that the salaries at the Marina included one full time employee (whose salary is split with streets) and three (3) or four (4) summer employees.

Mayor Cerino stated that excluding debt service, it appeared that the Marina would net $70,000.00. Mr. Ingersoll stated that if the Marina storage was removed and slips were gone the model begins to change but he was trying to keep a running marina during the partial renovations.  Ms. Kuiper asked where the auditing fees for the Marina were located.  Ms. Miller stated that all auditing fees were under the general fund.

Mr. Ingersoll stated reviewed the proposed Utilities Department Budget.

Mr. Ingersoll stated that there was $300,000.00 in the Mayor and Council budget for road construction.

Ms. Kuiper asked about the recycling budget and if there were signs ordered for the parking meters. Ms. Miller stated that prices for the parking meters would fall in this year, hopefully.  Ms. Kuiper suggested moving recycling to a bi-weekly schedule to save some money.

Mr. Ingersoll pointed out the breakdown of individual items for recreation, tourism and public relations. In that way the Council could see what amount was indicated for each.  Ms. Kuiper asked about the Recreation Commission and their budget.  Ms. Miller stated that they have not put in a budget request for this year, but there was $5,000.00 in the proposed budget for the Recreation Commission, which was the same amount funded last year.

Ms. Miller stated that the Bayside HOYAS put in a request for $5,000.00. The Council stated that they were a newer group and thought that $1,000.00 would be appropriate for a first year donation.  Mayor Cerino stated that he worried about setting a precedent with a large donation.

Ms. Kuiper stated that she would like to know the Town student enrollment from Kent County Parks & Recreation for the summer camperships. Ms. Miller stated that she has already made the calls to Kent County and was waiting on numbers.

Mr. Ingersoll stated that if there was anything that the Council did not see in this budget to let him know so that it could be worked into the next budget workshop meeting of May 9th.

Mayor Cerino called the workshop budget to an end at 7:30 p.m.

Submitted by:                                                             Approved by:

Jennifer Mulligan                                                        Chris Cerino

Town Clerk                                                                 Mayor

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