Staring at a dire five-year budget outlook, Peachtree City's city council will host a workshop tonight to try to narrow down exactly how much of an increase its residents will see on their 2011 property tax bills.
The probable tax increase should come as no surprise. The 6:30 p.m. city hall budget workshop will be the fifth in a series of open forums designed to give the public unprecedented access to the city's budgeting process. The previous workshops and a 'Budget Town Hall' were covered by local media and video of the sessions remain available on the city's Web site: www.peachtree-city.org.
Peachtree City is facing a projected $18 million shortfall over five years. During a previous budget workshop, City Finance Director Paul Salvatore said the projected problems predate the recession and have only been magnified by the continued economic slump.
"A big part of the problem is that our five-year model has been showing the need for a millage rate increase since before the recession," Salvatore explained.
"What previous councils have done is order a 27-percent increase in the overall budget, staffing and size of the public safety department and pushed through a large scale library expansion without touching the millage rate.
"We have successfully adjusted the budget for the recession over the past two years, but we've not been able to address the long term shortfall."
To adjust for the recession last year, the city outsourced the landscaping and building departments -- reducing the city's workforce by nearly 30. Council doubled the amount employees had to contribute to their health plans, suspended all pay raises and took away cost of living adjustments, a cash benefit commonly known as 'COLA.'
Mayor Don Haddix said city leaders must now decide to either raise property taxes or cut services. The majority of residents who spoke during the council's June 10 Budget Town Hall expressed a preference for the former over the latter.
Only Post 1 councilman Eric Imker was willing to explore what he called "the third option" -- cutting pay and benefits for city employees. He pointed to the city's low turnover rate as evidence that the city could afford to further reduce wages. Imker, a self-described budget hawk, presented his comprehensive analysis during the first budget workshop on June 1.
After failing to gain support from other members of council for reducing employee expenses, he adopted a more pragmatic approach. Imker has since stated that he would "prefer a 1 mil increase up front [next year]" if it can negate the long term deficits and keep the millage rate lower during the out years of the five year model.
Salvatore's original proposed budget included a 0.25 mill increase for fiscal year 2011. However, his model called for additional increases in 2012, 2013 and beyond.
Council now appears to support a plan to "make the hard decisions now," as Imker has said.
That likely means a higher increase in 2011, with little to no tax hikes occurring in the later years of the model.
Several other factors amplify the city's dire budget outlook. With SPLOST money running out in 2013, the city will need to use the general fund to cover the $1.5 million spent annually on cart path repair.
The city will also lose a share of its sales tax revenues in 2013 as new census figures will almost certainly award larger portions to Fayetteville, Tyrone and the county's unincorporated areas -- all of which have seen more growth over the past decade than Peachtree City.
And finally, funding for the Development Authority of Peachtree City will also likely surface as a topic for discussion tonight.
Development Authority of Peachtree City is asking for a nearly five-fold increase in funding for the upcoming fiscal year as it tries to take on a more critical role in steering the economic future of the 51-year-old planned city.
DAPC chairman Mark Hollums asked for a fiscal year 2011 budget of $150,000 -- enough to hire a staffer and rent a small office space from either the tourism authority or the city itself.
DAPC is receiving $35,000 from the city during the current fiscal year.
Council was divided on the proposal when it was first presented.
|
