Budget picture in the borough gets worse

Tuesday, November 25, 2008 10:35 AM EST

POTTSTOWN — The news didn't get any better Monday as borough council sat down for its second attempt to decide on a budget that may result in cutting 13 positions and 25 percent of the contribution to fire companies, and a tax hike of 11 percent or more.In fact, the news is so bad it's bad news in the past, present and future.Timothea Kirchner, a consultant with Financial Solutions and the borough's acting finance director, said the results of the 2007 audit show that the borough ended that budget year in a $1.2 million hole.As for the present year, the latest figures indicate 2008 will likely end with a deficit of "between $800,000 and $900,000."

Kirchner said the borough has "enough cash on hand to take care of that deficit," but may not have enough to pay bills until April 2009, when tax revenue begins coming in.As for the fiscal future — specifically 2009 — things don't look any brighter.Although council held off on making a final budget decision Monday evening — the result of which may add $100,000 to the 2009 budget — it did not appear that there would be any last minute good news that would spare them from making any of those decisions.Assistant Borough Manager Jason Bobst told the council that the latest figures show the borough's assessed property value dropping further, $4.8 million to be exact, since the last time they checked it. Changing nothing in the current budget proposal, that loss of value would increase the proposed tax hike from 11.47 percent to 11.53 percent.One piece of good news presented Monday night offset that loss: Bobst said the borough's health care costs are expected to go down in 2009 by $69,000. That alone would bring the proposed tax hike from 11.53 percent down to 10.95 percent.It was not these items on which discussion focused Monday night, rather it was on the $1.1 million in cuts that the administration has proposed and, primarily, on the jobs on the line.Mayor Sharon Valentine-Thomas, who said she was speaking Monday as "a champion for public safety and emergency services," said the proposed cuts to the fire companies would "jeopardize the safety of the borough and the integrity of its buildings."Valentine-Thomas said a series of cuts suggested by Fire Chief Richard Lengel and a .402598 millage increase to the fire tax could help to close the gap.That proposed fire tax increase would add $20 to the $65 a homeowner whose home is assessed at $50,000 now pays toward fire protection, said Bobst.Valentine-Thomas added, "I don't believe putting ourselves in jeopardy for downtown buildings having more fires with less coverage is a good revitalization plan."On that subject, Councilman Stephen Toroney went to bat for Economic Development Director Terri Lampe, whose position is set to be cut under the current proposals. He pointed out that with her gone, economic development will "fall on the shoulders of people not trained to do economic development."Council Vice President Greg Berry, who also chairs the council's finance committee, said Pottstown is one of only two municipalities in Montgomery County employing an economic development director, the other one being Lower Merion. "So there are other municipalities in Montgomery County doing a much better job at revitalization without a director," Berry said.But Councilman Jody Rhoads said he and other council members had received letters from The Hill School and Pottstown Memorial Medical Center "concerned about us getting rid of the director we have in town. There seems to be a lot of concern from some big players in town."He suggested the mayor and council members forgo their salaries for 2009 as a symbolic act, to which Toroney said, "I have no problem with that."Bobst said that would save the budget $7,600.Councilman Mark Gibson said the budget could save $77,000 by dropping three grants that require matching funds from the borough. The grants he identified are the homeownership initiative, which costs the borough $30,000 and gives it access to $270,000; a $15,000 match for an airport project that gives the borough access to $585,000; and the $32,500 the borough must provide to get another $32,500 from the state to hire a consultant to get its finances in order.Borough Council President David Garner said this last grant "is meant to help us with the very type of issues we're dealing with right now. I think we absolutely need to pursue that project."One thing that may no longer be pursued is the continuation of Pottstown Community Television. Bobst explained that since 2007, PCTV has been a drain rather than a boon to the general fund, requiring between $150,000 to $200,000 a year.Kirchner said that in 2008 she anticipates PCTV will again cost the general fund "six figures." She said those costs "have to do with the debt on the equipment that the borough recently purchased."That lead Garner to note, "Perhaps PCTV will be a casualty of this budget."The human casualties of the budget proposal were on hand in force.Karen Lewandowski, president of unit 2784 of the American Federation of State, County and Municipal Employees, introduced the council to each of the union members who would be laid off under the current proposal, asking all eight to stand. They ranged in duties and service with the borough from Kathie Minotto, a payroll clerk with the borough for 28 years, to Greg Dopwell, a streets worker with the borough for less than a year."I just wanted you to look them in the eye," she said.Lewandowski also noted that with the elimination of the union positions, the borough's ratio of managers to employees would drop to one manager for every 2.4 employees."You're telling us to suck it up. Well I'll suck it up when that ratio's lowered," she said.Minotto said, "Many times we have brought issues to the manager and the assistant manager about excessive spending and reported unnecessary overtime by management positions, but it was like talking to a wall."She offered the example of a manager at the borough garage, who she did not name, "who goes on vacation five times a year and one manager gets one hour of double-time every morning during those five weeks to come and open the garage when there are already three managers there anyway."Jo-Ann Kelley, whose husband works in the streets department, also told council that it should "keep union workers and cut redundant managers and supervisors."Gibson voiced similar concerns when he questioned why the water plant has three supervisors working during the day and none at night, causing overtime to be incurred every time one has to come in to deal with an issue in the evening.Borough Manager Ray Lopez said that matter is being addressed."I asked that question four of five months ago and I didn't get a straight answer then, and I don't think I'm getting a straight answer now," Gibson said.Dopwell told the council he left "a good job" to come work for the borough "and I have to wonder why you hired me if I'm getting cut a couple of months later."He said his last day could be as early as Dec. 19, "right before Christmas, and I haven't even done anything for my four children yet. I'm real upset." He then wished all of the council members a "Happy Thanksgiving."It remains unclear if the appeal will be effective.Berry replied, "It would be much easier for us to say there will be no cuts, but we can't ignore the fiscal disarray the borough has been in for the past several years, and we are bringing these fiscally responsible issues to the table, in public."Toroney said, "These are not just positions, they're people." He noted that none of those whose positions may be cut were alerted ahead of time and found out in the public meeting."We cannot look at an individual person. We have to look at the positions themselves," Berry said. "I cannot see what other way you could do it in a public setting, unless you want to continue, as in years past, doing it all behind closed doors in the back room."Garner said he was impressed by the proposal management brought to council. "I think we can go deeper."He noted that much of the focus of council's questions focused "on the little things and we have a huge, huge deficit."When budgeting began, the gap was $1.9 million and would have required a 30 percent tax hike to close it without cuts. If the proposals discussed Monday are enacted, that shortfall will drop to just under $700,000."Every year we ask, 'What will it take to turn the borough around?' and raising taxes every year is not the answer," Garner said. "Even with these cuts, there will be a tax increase."Garner also said he would like to consider a restructuring of the fire department. "Not just cuts, restructuring," he said. "I think it's a luxury to have four departments and 12 paid drivers."The suggestions he asked Bobst to investigate in that area are not completed and have not yet been made public."I do not want to use trite expressions, but things have to change," said Garner. "I've lived here all my life and every year it has just been 'suck it up and pass on the tax increase.' It has to stop."

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