By ANDY KIRKALDY
VERGENNES — Vergennes aldermen on Tuesday looked at a first draft of a 2008-2009 municipal budget that could hike city spending by $156,000, or almost 10 percent, to about $1.78 million.
But despite that apparently dramatic increase, City Manager Renny Perry told aldermen that a jump in the municipal portion of the Vergennes tax rate was not a sure thing.
Perry said he was projecting a budget surplus of roughly $40,000 from the current fiscal year, which ends on June 30. And he said an increase in the amount of taxable property in Vergennes — including VELCO’s new substation — could boost revenue to cover the increased costs.
“It looks like a lot of money. It is a lot of money. But … it’s too early to predict what our revenue situation is going to be,” said Perry, adding, “There’s a whole bunch of factors that will determine what effect this will have on the tax rate, if any.”
Perry is concerned about how soon the substation will get on the tax rolls, however: He said VELCO missed an April deadline for providing an estimate of its taxable value to the Vermont Public Service Board, and he hopes that there isn’t a “loophole” that will allow the power transmission firm to escape taxation for an unfinished project.
If Perry’s guess on the surplus is accurate and the city’s grand list grows enough, the city’s tax rate could even remain level this year. According to late-winter Addison Northwest Supervisory Union estimates, the school tax portion of the city tax rate could drop by almost a penny. ANwSU business manager Donna Corcoran said on Wednesday that nothing had changed since then to move that estimate.
Increases in the draft city budget were across the board, and were concentrated in unsurprising areas, notably fuel and insurance costs.
“There is a theme that goes through the whole budget. (There are) items you have very little or no control over,” Perry told aldermen.
Aldermen will meet on June 17 and 24 to make final the budget and set the tax rate, jobs that must be finished by a June 30 deadline. If necessary, they will sit down again on June 30, to complete the task.
Within the budget, department by department:
• In the administration/general expenses budget, most of a $23,000 increase to a proposed amount of about $363,000 comes from the decision of Perry and his wife to sign onto the city-offered health insurance plan. There are also some increases in heating fuel and liability insurance.
• Much of a $53,000 increase in the police department budget to a proposed amount of roughly $423,000 comes from labor costs. One patrolman is going on a three-month military leave, and another must take a four-month course at the state police academy, Perry said. Fuel and cruiser maintenance (that because the city is keeping cars a year longer to cut purchase costs) are also rising, as are pension and health insurance costs.
• Much of proposed $55,000 hike in the public works budget to about $616,000 came from predictable increases, Perry said: heating and truck fuel, maintenance on older trucks, paving and insurance. “The increases in public works are probably the increases you would expect,” he said. A 40 percent spike in the price of salt also prompted Perry to add $13,000 to the winter maintenance materials line item.
• Most of a proposed $13,000 increase in the fire department budget to about $136,000 comes from $9,000 to replace the bay doors of the Green Street station. Perry said the doors are too small for modern equipment. The city pays only about 36 percent of the cost of the fire department, which also contracts with surrounding towns for protection.
• General expenses are projected to rise by almost $24,000, mostly due to the switch of the Vergennes Area Rescue Squad and Addison County Transit Resources to aldermen-decided line-item funding from voter-decided charitable contributions; those hikes will be offset by a drop in charitable line items. Perry has also suggested about $9,500 of energy-saving improvements to city buildings that could pay off in two to five years.
• Perry has proposed level-funding the city’s recycling center at $50,000.
The city’s sewer fund is not truly part of the deliberations because it is user-funded and not supported by the tax rate. Last year aldermen approved a $553,530 sewer budget.