Schenectady budget plan keeps tax hike under 2 percent (with document)

PHOTOGRAPHER: Kathleen Moore

Fees for “baby sitting” will help pay for the police department next year, according to Acting Mayor Gary McCarthy’s proposed 2012 budget.

Schenectady city budget proposal

To read acting Schenectady Mayor Gary McCarthy’s proposed 2012 city budget, click HERE.

He asked the City Council to approve a $79.2 million budget — up from $77.4 million this year — with a 1.89 percent tax increase. For a homeowner with the average house, assessed at $100,000, taxes would go up $24, to $1,333.

City fees would go up, too: $24 more for garbage collection, $22.92 for sewer and $20.64 for water. That means the homeowner would see a total increase of $91.56 next year.

But McCarthy said the proposal was far better than the original spending plan, which had a 20 percent tax increase.

His proposal focuses on the issues he has said can be improved through creative budgeting: slow police response times and abandoned houses.

If the City Council approves McCarthy’s budget, police will start fining property owners for loud parties, rather than simply asking them to quiet down. The budget estimates $10,000 would be collected over the next year.

McCarthy hopes the fine will drastically reduce the number of noise complaints, allowing police to increase their response time for more serious issues.

“We’re sending the police out to be high-priced baby sitters,” McCarthy said. “As I look at the police calls and how we get calls backed up, there are a large number of calls that are for loud parties, music.”

McCarthy’s spending plan also calls for the city to purchase about 20 abandoned houses and resell them, bringing in about $400,000. The goal is to sell houses that still have some value and can be repaired, rather than only taking properties that must be demolished at the city’s expense.

His staff calculated that getting those houses back on the tax roll, as well as other houses that will be repaired through a partnership with Key Bank, would also save the city $300,000 in lost taxes.

McCarthy also wants to make money while reducing commercial traffic on local roads. Under his spending plan, police will start doing truck inspections next year — enforcing weight limits and other issues that damage roads and lead to residential complaints. Residents on Kings Road were so upset by truck traffic that they put up signs this year asking trucks to slow down.

Leaving cars on the road during paving projects and blizzards would also become more expensive. Currently, the city doesn’t charge a towing fee — drivers only pay a fee to the towing company. The city would add its own fee next year, collecting $50,000.

And then there’s the stubbed toes. The city would also add a small fee for paramedic service to discourage those who call about minor problems. The budget estimated $10,000 would be raised through the fee next year.

“I’ll call it the baby sitter role. Somebody stubs their toe and it’s the end of the world,” McCarthy said. “We’re sending the paramedic, we’re sending the ambulance.”

But all of the “baby sitting” fees and fines are estimated to bring in only $130,000. The housing plans would bring in another $700,000. With the cost of health insurance and pensions increasing, that would not have been enough to keep the tax increase low.

Finance Commissioner Ismat Alam took an unusual approach, however: She asked the state comptroller’s office for permission to use money from the now-flush sewer and water funds.

In 2004, those funds fell deeply in deficit, and the city “loaned” the funds $2.7 million to get them out of the red, she said. Now she is moving that money back to the general fund, which pays for most city operations, including streets, public safety and parks.

She said the Comptroller’s Office approved the transfer as the repayment of a loan from the general fund.

It’s a one-time shot of cash; the city will have to either cut the budget or raise revenues by $2.7 million in 2013. There is not enough money left in the city’s savings account to cover it — there’s only about $1 million left, Alam said, barely enough to cushion the city’s monthly cash flow needs.

The budget also assumes the city will sell most of the 79 cars that police have seized over the years, as McCarthy announced earlier this year, and that other municipalities will buy $45,000 worth of salt and fuel from Schenectady at the city’s new complex on Foster Avenue.

Alam also found unlikely sources of additional revenue by looking more closely at how much the city has made in previous years. Among the happy surprises, she found that the city was regularly receiving $100,000 more than it budgeted for insurance repayments.

“We scrubbed every single account,” she said.

There are no layoffs in the proposed budget, but vacant positions would be eliminated. That would cut six firefighter and four police officer positions.

The City Council will now meet six times in the next four weeks to hammer out any changes its members want to make to the budget. The council must pass a spending plan by Nov. 1, exactly one week before the election. Voters will select a mayor and four city council members.