VERGENNES — The Vergennes City Council on Tuesday added two cents to the tax rate needed to support city services and adopted a $2,290,291 municipal budget for the fiscal year that begins July 1; the budget will increase city spending by about $58,000.
Most of the increased spending comes in the police budget, which rose about $32,000 to $898,600. Police spending accounts for about 39 percent of the Vergennes general fund budget that the council adopted on Tuesday. The general fund budget does not include the sewer budget, which is funded separately by user fees.
The tax rate for fiscal year 2017-2018 is 81 cents, up from 79 cents. That 2-cent increase translates to $20 more in taxes for every $100,000 of assessed value of city property.
City officials said they expect state officials to release final school tax rates this Friday, June 30. Addison Northwest School District estimates released in February projected a 1.3-cent increase in the Vergennes residential school tax rate.
City Manager Mel Hawley told council members on Tuesday he expected the city’s fiscal year, which ends on June 30, to end with a fund balance of about $140,000.
If council members chose to use $118,000 of that projected fund balance to offset taxes, Hawley said, they could leave the tax rate at 79 cents.
A year ago, the council used $140,000 of a $180,000 fund balance while they raised the city tax rate by 4 cents to 79 cents. This time, Hawley said, if the council kept the 79-cent rate the remaining fund balance would leave less margin for error.
“It’s a thin cushion,” Hawley said, adding, however, “It’s not like you would be adopting a budget with red ink.”
Hawley’s budget drew praise from Mayor Michael Daniels.
“I don’t think we should step backward in any way, and what you’ve presented is very solid,” Daniels said.
Some council members were concerned about long-term needs, including maintenance of the city pool.
“At some point we’re going to have to steer the boat into getting more revenue,” said Alderman Matt Chabot.
Alderman Renny Perry moved for the budget and the 79-cent rate, but Alderman Jeff Fritz suggested an amendment to the 81-cent rate, citing, like Chabot, needs that included the pool. Fritz also pointed to the sewer rates, which were stable for many years and then required a substantial increase, and suggested smaller, regular increases were a better idea.
“I’d prefer 1 or 2 cents more now, not 10 cents later,” Fritz said.
Alderman Lowell Bertrand said he agreed with Fritz and added he thought the fund balance would be “a little too thin” without the extra 2 cents on the rate, which will raise about $45,000 of revenue.
All present — Alderwoman Lynn Donnelly did not attend the meeting — then voted in favor of the 81-cent rate.
Most of the increase in police spending comes from a $30,000 increase in the capital purchases line item. Hawley said he and Chief George Merkel agreed to postpone buying a new cruiser for a year, but at the same time pay off early an internal loan from the city Water Tower Fund’s “continuation fund” to the department, with that amount reflected in that line item.
The public works budget will increase by about $16,000 to $761,881. Hawley said it includes more money for sidewalk upgrades, while paving funding is level.
The administration budget is up by about $4,000 to $380,647, but will rise by another few thousand dollars when the council sits down next month and gives raises to Hawley and City Clerk Joan Devine.
The council also voted to restore $3,000 in funding to the Addison County Economic Development Corporation that Hawley had removed from the budget. Hawley said he did not approve of ACEDC Executive Director Robin Scheu’s decision last fall and to run for the Vermont House (she now represents Middlebury) and the board’s approval of that decision.
He said he resigned from the ACEDC board in protest, and made the budget adjustment for the same reason.
“Was I sending a message by putting a zero in there? Absolutely,” Hawley said.
After listening to residents and ACEDC board members Chris Knapp, Sarah Cowan and Sas Stewart speak on behalf of economic development commission and describe the lending and support it gives to local and county businesses, the council restored the $3,000 line item.
The budget also includes $7,500 for the Vergennes Partnership, which the council also agreed to boost with another $7,500 from the city’s Water Tower Fund. The partnership is charged with overseeing the health of the city’s downtown and enhancing its economic development.
Amy Bodette Barr, Partnership marketing and development coordinator, and Partnership board member Danelle Birong outlined the partnership’s own fundraising, which they said totaled $22,000 since the beginning of 2016, and recent accomplishments.
Among those, they listed helping Shacksbury Cider move to Kennedy Brothers, improving Wi-Fi downtown and establishing it in the Otter Creek basin, creating a promotional video that has been viewed more than 20,000 times on the Vermont tourism website, upgrading its own website to serve visitors and residents with a comprehensive events list, working to establish a “Neighborhood Development Area” in Vergennes that could lower the cost of new housing in the city, and writing the grant to help fund the streetscape project at the corner of Green and School streets.