Nothing is sacred in Mayor Brian U. Stratton’s proposed city budget.
In a presentation to the City Council, he proposed 68 layoffs, a 4 percent tax hike and a new fee that would force nonprofits, as well as all other property owners, to pay for street maintenance.
The budget would “severely” cut services as well, he said.
His proposal cuts the Fire Department so drastically that Fire Chief Robert Farstad likened it to asking a general to fight a war after taking away much of his army. Nineteen firefighters would be laid off, forcing the department to close one of its four stations.
Budget available online
The proposed 2011 budget for the City of Schenectady — all 95 pages — is now available online on the city's website. Click HERE to access the site, scroll down the right side and click on "City of Schenectady Proposed 2011 Budget."
Stratton also said the city should live without the 12 police officers it was to hire next year to fill vacancies — including those from officers who were forced out through this year’s disciplinary process.
Stratton also told the City Council to eliminate the entire parks maintenance division — 13 workers — which might force the city to close the parks altogether. Even if the City Council were to agree to use federal Community Development Block Grant funds to take care of the parks, the grant would not begin until June — possibly leaving the parks unmowed and their ball fields unprepared all spring.
In total, he proposed eliminating 89 positions, including 68 layoffs. The rest come from vacancies and early retirements.
“But that’s only the beginning of what the pain will be,” he said as he presented his $76.8 million budget. “There’s not a whole lot of choice here beyond raising taxes through the roof.”
Instead, he proposed raising taxes by 4 percent and creating a new fee for all property owners — including nonprofits — to raise $1.4 million. The fee would pay for street maintenance, which would no longer be paid for through taxes.
The “curb fee” would be assessed for every foot of frontage along city streets. City officials have not yet calculated the per-foot cost but expect to announce it before the public hearing on the budget on Oct. 12.
The hearing will be at 7 p.m. at City Hall.
Stratton said the fee has been successfully implemented in Rochester, where it covers many more operations relating to engineering and street work.
Council president and Democrat Gary McCarthy, who opposed a curb fee when it was proposed by Republicans a decade ago, said he supports it now.
“Because the numbers are so out of whack, I don’t know how else we’d do it,” he said, adding that because the fee must also be paid by nonprofits, “it may bring some equity to the system.”
Ellis will go along
A spokeswoman for Ellis Hospital, one of the city’s biggest nonprofits, said Ellis would reluctantly support the new fee.
“However, we don’t believe this should set a permanent precedent,” spokeswoman Donna Evans said. “We view these types of proposals with a measure of concern because they essentially tax not-for-profit organizations.”
She emphasized that the hospital is suffering, too.
“As a not-for-profit hospital, facing our own financial challenges, we certainly understand the city’s plight during these tough economic times,” she said.
She noted that Ellis already helps the city — the hospital provided $41 million in free medical care last year to residents who could not afford to pay.
But, she said, Ellis recognizes that the city is facing “extraordinary circumstances.”
“We are willing to step up with an additional, reasonable contribution,” she said. “We’ll work with the city because we are partners.”
A call was not immediately returned from Union College, which has steadfastly opposed any of the mayor’s proposals for a voluntary payment for city services.
Before calculating the curb fee, the mayor’s budget would raise taxes by 50 cents per $1,000 of assessed property. The tax rate would be $13.07 per $1,000 assessed.
For the average property owner with a house assessed at $100,000, taxes would go up $50 next year. The bill would be $1,307.
The fees for sewer, water and garbage collection would remain the same.
Department heads warned that if the council adopts the mayor’s plan, city services would be seriously damaged.
Fire Chief Robert Farstad said layoffs would “severely” hurt the department’s ability to put out fires.
When multiple calls come in at once, he said, there would not be enough firefighters available to mount an interior attack on a major fire.
It might also take firefighters much longer to reach the fire because one of the four strategically-located fire stations would be closed. If the fire was in that station’s zone, it could take three times as long for firefighters to get there, Farstad said.
He called the layoffs and station closing “drastic.”
“I wouldn’t support any cuts,” he said, before adding, “I’m a soldier. I carry out the order.”
Firefighters would rush inside burning structures to save lives, he added. “We’ll attack conservatively unless there’s a life hazard,” he said.
Commissioner of General Services Carl Olsen said the cuts in his departments would not only risk closing the parks, but would also leave him without enough workers to paint graffiti, clean blighted properties and handle nuisance violations.
Olsen, like all the department heads, got his first look at the proposed layoffs when the mayor presented it to reporters Monday. He appeared stunned.
“I don’t know what we’re going to do,” he said.
Police Chief Mark Chaires said he believes the final budget won’t cut 12 police officers.
“The situation’s fluid right now,” he said, adding that he won’t “speculate” on how he would handle the cuts until after the council adopts a budget on Nov. 1.
Public Safety Commissioner Wayne Bennett said the department would continue to run its new directed patrol and community policing programs even with the cuts. Response times would also not be affected, he said.
“We’re maintaining it now” with the vacancies, he said. “We have adequate coverage.”
In the past, the department has vastly overspent its overtime budget when it had vacancies. However, the 2011 proposed budget reduces overtime from $1.4 million to $800,000. The department had asked for $1.7 million.
Under the mayor’s budget, spending would go down, from $78 million this year to $76.8 million next year.
But taxes would go up. That’s because the city is losing revenues it depended on for years.
Most notably, it is no longer bringing in $6 million or more in the annual sale of its delinquent tax liens.
Compared to previous years, it expects to lose $2.6 million in uncollected taxes next year.
State aid has also decreased by $362,000. And the city can no longer use its savings — there’s not enough money left in the savings accounts. This year, the city spent $7.6 million in savings. It only had $5.8 million to spend next year, until it received an unexpected $1 million payment for back taxes when Galesi Group bought the dilapidated Alco property.
All of that money is being added to the 2011 budget, allowing the city to spend $6.8 million of its savings.
While revenues are falling $3.7 million, expenses have skyrocketed, going up $2.5 million.
The city’s debt payments are increasing nearly half a million dollars next year, thanks to the new Bureau of Services complex on Foster Avenue.
Pension costs have gone up, so the city will spend another $313,000 on its employees’ retirement savings next year.
The layoffs will save the city millions — but they aren’t cheap. Stratton anticipates having to spend $568,000 to buy out employees’ accumulated vacation and sick time, and another $520,000 in increased unemployment insurance.
Health insurance is also going up $376,000, workers comp is going up $209,000 and the Police Department’s workers comp is going up $64,000.
All that left the mayor with a $6.2 million hole to fill. Layoffs and other cuts reduced expenditures by $3.7 million. Raising the rest through taxes would have required an 8.8 percent tax increase, he said.