Seven expiring public employee contracts pose a potential budget squeeze next year for Saratoga Springs, Finance Commissioner Michele Madigan warned Tuesday night.
While laying out her proposed comprehensive budget for 2014 at the City Council meeting, she expressed grave concerns about the additional costs that could be incurred with negotiating new contracts to replace those that expire at the end of this year. Madigan highlighted the potential impact by noting that costs this year jumped $500,000 because of two contracts.
“Consider the costs of settling all seven,” she said.
The rest of Madigan’s budget reflected this conservative approach, as she took out two projects from the capital budget for next year, projected a decrease in sales tax revenues and imposed spending cuts in discretionary areas for each department.
The budget’s general fund increases year-to-year spending by about $460,000, to a projected total of about $40.3 million. She said about 90 percent of the budgeted costs are out of her control, including mandated expenses, essential services and equipment purchases, leaving about $4.4 million for discretionary spending.
About $18.7 million in property taxes would be collected — roughly $16 million for the city’s general fund, a decrease of about $200,000 from this year’s budget, and $2.7 million for debt service and special districts. The proposal carries a 0.68 percent average increase in the tax rate, according to the budget presentation.
The budget projects $10.45 million in sales tax revenue next year, which is $150,000 less than was budgeted for this year. As of July, the city’s sales tax collection has been below what was projected, although it is likely that the figure will come in line when August and September are factored in, considering those months benefited significantly from events held as part of Saratoga 150 and the Farm Aid concert.
Madigan’s budget anticipates that the city will continue to receive support payments for hosting the Saratoga Casino and Raceway at the increased level of about $1.8 million that was approved this spring by the state. The budget also projects an increase in revenue from mortgage tax collections, the city ambulance program and Planning Board fees, which have already tripled this year’s budgeted amounts.
About $1.18 million is drawn out from the city’s fund balance to cover retirement costs, a contribution to the tax stabilization reserve and debt services fund, equipment purchases and the establishment of reserve funds for insurance and debt services.
The capital projects budget includes $192,000 of bonding for some type of medical facility or fire station on the east side. Last year, the council authorized $200,000 for this project, but it has not yet committed to undertaking the project.
Removed from the capital projects budget was a $572,000 evidence and records facility for the police department. Madigan said the project hadn’t been developed enough, but she left open the option for it to be included in future capital budgets.
Madigan said there are six workshops scheduled starting Oct. 8 to review the budget, and the first budget hearing will be Oct. 15, at the next City Council meeting.