Memorandum

City of Lawrence

City Manager’s Office

 

DATE:

08/02/2012

TO:

David L. Corliss, City Manager

FROM:

Casey Toomay, Budget Manager

CC:

Cynthia Wagner, Assistant City Manager

Diane Stoddard, Assistant City Manager

Jonathan Douglass, Assistant to the City Manager / City Clerk

RE:

2013 Budget Enhancements and Commission Directed Changes

 

Additional information on enhancements included in the 2013 proposed City budget is provided below.

 

Background

For purposes of building the 2013 budget, it was assumed that one mill of property tax is equivalent to approximately $848,000. When budgeting revenues from property tax, however, the City only assumes that we will receive ninety-seven percent of the revenue generated by the mill rate. The difference can be attributed to property tax appeals and late tax payments.

 

The City Manager’s recommended budget included an increase of 0.87 mill to provide additional resources for police equipment and staffing, as well as additional resources for economic development efforts and pavement marking, and to provide supplemental pay for city employees on military leave. 

 

At their meeting on July 10, the City Commission directed staff to add an additional 0.05 mill increase for increased resources for the Lawrence Community Shelter and Hearthstone. 

 

Mill Increases Needed in 2013

The mill levy increase of 0.92 mill would provide an additional $770,000 in 2013 to be used as follows:

 

Mills

Description

2013 Cost

0.36

Increase annual equipment expenditures in Police Dpt. operating budget

$300,000

0.33

Three additional police officers (includes city’s contribution to healthcare, equipment, training, vehicle)

$275,000

0.07

Increased resources for pavement marking and striping

$55,000

0.09

Economic development funds

$75,000

0.02

Military Pay Supplement for Eligible City Employees

$20,000

0.05

Lawrence Community Shelter and Hearthstone

$44,600

0.92

Total Mill Increase for 2013

$769,600

 

Additional information on each of these needs is provided below. 

 

 

Needs to be Funded Through the Mill Levy Increase

 

Police equipment. One of the top priorities of the police department is increased operating funds for equipment. Due to limited resources in recent years, funding for the provision for maintenance and replacement of equipment and technology has not been incorporated into the department’s operating budgets. Instead these needs have been provided through the use of one-time funds. By increasing the mill levy, it would be possible to provide an ongoing revenue stream to support an increase in the baseline police department budget in the general fund. An increase of .36 mill would provide $300,000 of additional resources for the department. The attached memo provides a plan for how those funds would be spent over the next four years.

 

Police staffing. One of the top priorities of the police department is additional staffing. A multi-year plan has been developed and staff has created a model to project the costs and the revenue requirements to fund that plan. The police department has indicated that additional officers for patrol is the most immediate need. An increase of .33 mill would provide 3 additional positions, as well as equipment, training, one additional vehicle, fuel, and maintenance.

 

Pavement marking. The City has not been able to devote appropriate annual resources to pavement marking in the community. To help address this issue, the City Commission authorized the purchase of a paint striping machine in 2011. The one-time purchase was made with proceeds from the infrastructure sales tax. An increase of 0.07 mill would provide an on-going revenue increase for pavement marking supplies and maintenance of the machine. While other resources (e.g. infrastructure sales tax) could assist in this effort, this would only mean a reduction in available resources for continued street maintenance.

 

Economic Development funds.  Current city revenues do not provide sufficient funding or flexibility to quickly address economic development opportunities that present themselves.  Recent examples include working training at Plastikon, fire sprinklers at the Poehler building, and reimbursement for certain expense at the recently completed 901 New Hampshire building.  Similar opportunities will likely occur in the future.  An increase of 0.09 mill would provide $75,000 to address opportunities should they arise and would prevent the need to spend down fund balance. 

 

Military pay for city employees.  The City has a number of employees who are serving our nation in the military on reserve or active duty.  While these employees are paid by the military for their service, in some instances, their temporary military service means a reduction in pay.  A mill increase of 0.02 mill would allow the City to provide the differential between the employee’s city salary and military salary, up to $15,000 each year per employee.  There are several municipal employers in our market that offer similar programs. 

 

Lawrence Community Shelter and Hearthstone.  Each year, the Lawrence Community Shelter (LCS) applies and competes for City social service funding.  The shelter has spent a great deal of resources in recent years trying to find a new location outside of downtown in response to neighborhood concerns.  Now that a new location has been secured, the shelter is anticipating the need for additional operating funds.  The social service funding advisory board recommended and the City Manager’s recommended budget included funding for the community shelter as follows:

 

General Operating Fund

$63,000

Special Alcohol Fund

$36,000*

TOTAL

$99,000

*Not including a one-time payment of $100,000 approved by the City Commission in 2012.

 

An increase of 0.04 mill would generate an additional $37,000 for LCS, bringing their general operating fund support to $100,000 and their total City support in the 2013 budget to $136,000.  LCS would no longer be considered a social service, instead being treated more like a vendor.  As such, they would no longer be subject to the same funding and reporting processes as other social service agencies. 

 

Lawrence Alcoholic Recovery House (Hearthstone) provides a halfway house program for low income men by offering low-cost safe housing for those striving to achieve sobriety.  The program has a capacity of ten residents.  This program was not recommended for 2013 funding by the Social Service Funding Advisory Board or included in the City Manager’s recommended budget.  An additional .01 mill increase would generate $7,600 to pay for rent, utilities, and maintenance costs not covered by $60 weekly rent paid by the residents. 

 

Conclusion

A mill levy of 0.92 mill would allow for an ongoing revenue increase in the General Fund. The increase could be used to address some of the Commission’s top priorities – police resources, economic development, and pavement markings, support for City employees serving in the military, and social services in our community.  The increase would bring the total city mill levy to 29.532 mills.