Faced with the possibility of losing out on more than $400,000 annually from Video Lottery Terminal revenue generated by Batavia Downs Gaming, the Batavia City Council has called a Special Conference Meeting at 7 tonight to consider an additional property tax increase in its 2020-21 budget.
A memo dated Feb. 5, 2020 from City Manager Martin Moore to City Council undoubtedly will trigger strong debate among Council members during their meeting at City Hall.
The regular Business Meeting that includes the setting of public hearings on Feb. 24 for the budget ordinance as well as water rates, meter fees and capital improvement fees is scheduled after the Conference Meeting.
Moore’s memo suggests that Council needs to “come up with a combination of $700,000 in cost savings and revenues to pass a sustainable budget” by reducing expenses by $350,000 and increasing the property tax levy by $350,000 from the currently proposed levels.
Doing this would require an override of the state-imposed property tax cap, which also is subject to a public hearing (that would be slated for Feb. 24).
Moore’s original proposed budget lists a tax rate increase of 0.97 percent (below the property tax cap) -- $8.92 per thousand of assessed valuation last fiscal year to $9.01 per thousand.
The revised proposal would raise the tax rate to $9.60 per $1,000 of taxable assessed value – a jump of 7.5 percent.
Originally, Moore recommended, along with the 0.97 tax levy increase, the following:
-- Using $259,100 in General unassigned funds;
-- Using $225,000 in Water unassigned funds:
-- Transferring $257,400 in unassigned funds from workers’ compensation into the General fund;
-- Reducing funding requests by $500,000 (vehicles, new positions to cover bail and discovery law requirements, capital project and equipment reserves, travel costs, etc.).
With Gov. Cuomo’s proposed budget calling for the elimination of VLT money to municipalities, the outlook has changed dramatically, Moore contends.
Moore’s memo states that after an extensive review of past City budgets, his original recommendation for the use of $257,540 unallocated cash from workers’ comp is “unsustainable.”
Toward that end, he writes that his new proposal of balancing the $700,000 burden equally between expenses and revenues “retains our ability to accomplish the following”:
-- Maintain a high credit rating and keeping the tax rate below $10;
-- Cover unexpected budget cost overruns and emergency purchases;
-- Maintain room in the budget to provide for a school resource officer, salary and benefits for all employees, and increases in repeated criminal offense due to bail reform;
-- Cover insurance-related deductibles and potential claims;
-- Assign fund to capital, retirement and/or insurance reserves;
-- Maintain lower levels of “fiscal stress” by maintaining the total General fund balance and assigned and unassigned General fund balances as a percent of gross expenditures, the cash position of the combined funds, and reducing the likelihood of operating deficits.
