The headline "Council votes to lay off 12 workers" is woefully inaccurate and misleading.
Council did not vote to lay off anyone, instead council voted to eliminate 12 positions. Council can only hire and fire the borough manager and police chief. Council cannot lay off employees.
Thursday, December 11, 2008
Wednesday, December 10, 2008
Council votes to lay off 12 workers
See commentary regarding inaccurate headline.
Wednesday, December 10, 2008 11:58 AM EST
POTTSTOWN — Borough Council Monday night made some, but not all, of the difficult budget decisions it faces, the most significant being a split vote to lay off 12 employees.If no other changes are made, the budget, as it stands now, would drive a 19 percent tax increase in 2009.With Councilwoman Maureen Allen absent Monday night, the deciding vote on the layoffs fell to Mayor Sharon Valentine-Thomas, who votes on council only to break a tie.Joining the mayor in voting to eliminate the positions were council President David Garner, Vice President Greg Berry and Councilman Stephen Toroney.
Council was unable to make a decision on two other controversial aspects of the administration's budget proposal — the elimination of the economic development director position and a 25 percent cut in funding to the borough's four fire companies — because no one was willing to second motions for either action.Berry made both motions, but to Garner's visible frustration, none of the other members of council was willing to give either motion a second. Thus, neither matter could be brought to the floor for a vote."I am a little frustrated," Garner told council members. He added that "I am not voting for a 19 percent tax increase.""Taxes were raised 25 percent two years ago and 9 percent last year. We need to do better," Garner said. "The reality is revenues in the borough are declining, and they are declining because the taxes keep going up."He aimed his frustration at the council's failure to make a vote on the economic development position."With a declining tax base and the economy the way it is, keeping in $180,000 to pay for economic development is not advantageous for our community," he said."Everywhere else, they are cutting positions; we don't have the luxury of keeping everyone intact."Prior to voting to proceed with the layoffs, Berry reminded the members of council that they are elected not to represent the borough's employees, but the taxpayers."We represent and answer to the taxpayers and only the taxpayers of Pottstown," he said."Do I think 19 percent is something this town can take? I'm not sure," said Assistant Manager Jason Bobst, who with consultant and finance director Timothea Kirchner had made the case for the cuts."What I am sure of is we're going to be in the same situation next year if we don't take action now," Bobst said. "Just since we started this process, we've lost $8 million in property value, and it's going to continue to slide and we're trying to use this process to dig our feet into the sand and start to push back."Prior to the vote, Karen Lewandowski, who chairs the Pottstown unit of the American Federation of State County and Municipal Employees, informed council that the union members "have presented council with an offer of a wage freeze to their current contract." She said the wage freeze would save the borough about $111,648.It is unclear if the matter was given consideration by council; although, the members did meet in a closed-door executive session to discuss, among other things, contract matters.When the matter was raised during the meeting, Garner dismissed it saying, "There's nothing there."Last week, Lewandowski told the council that as much as $300,000 in additional revenue could be obtained by charging a 10 percent late fee to septic haulers who are behind on their payments for taking septage to the sewer plant for treatment.Monday night, Bobst said the borough is moving to implement a percent fee as a penalty, but that care must be taken."It's difficult to build a budget on outstanding debt," said Bobst. "To some extent, we have to accept this as being part of the business we're in. That's why we only budget on an assumption of collecting 93 percent of all taxes owed.""We tried implementing fines a few years ago and as soon as we brought the hammer down, the hauler declared bankruptcy and we didn't see a dime, so we could be hurt in the long run," said Brent Wagner, the superintendent at the sewage treatment plant.Lewandowski was not the only union member to address the council. Code Enforcement Officer Dave Borzick, recognizing that the task before council is "a difficult one," urged them to "get all the facts, not just the information designed by a few individuals with their own agendas."He pointed out that the money-saving ideas the union has recently provided "have been ignored before and I would wonder why you would only be taking advice from the very individuals that have allowed these situations to occur over three years. It seems like more smoke and mirrors."Borzick ended by quoting Adolf Hitler, saying, "Make the lie big, make it simple, keep saying it and eventually they will believe it."Don Read also addressed the council, saying the problem Pottstown faces is "there are more tax users than there are taxpayers" and urged the members to "break the cycle.""I will tell you that the taxpayers have been brought to a boiling point, and I'm one of them," Read said. "When did a good paying job become an entitlement funded by the taxpayers?"Read, who is also a member of the Pottstown Borough Authority, told the council, "You do not represent labor, management, department heads, contractors or consultants. You represent the taxpayers."He found agreement with another member of the authority, Aram Ecker, who told the council, "Without exception, everyone is at their wits' end about how much it costs to live in Pottstown.""Back in the 1990s, we had 32,000 people in town and we had a payroll of 90 employees. Now we have 21,000 people in town and we have 180 employees. There is an exodus of people leaving Pottstown. You can't raise taxes 50 cents," he said.No budget decision will be final until Dec. 29, council's adjournment meeting, where the budget and tax rate will be officially adopted.Garner wants a few more decisions to be made."I am not satisfied this is a budget I'm ready to vote on," Garner said. "I am trying to turn over rocks because I think 19 percent is way out of line. I don't think we've done a real good job here."As a result, he convinced council to have another meeting to discuss the budget. It will be held Wednesday, Dec. 17, at 6 p.m. in borough hall. It was not immediately clear if the public will be allowed to speak.Despite Garner's comments, council did make some decisions. With a 3-2 vote, it decided to make use of $177,000 — left over from the $250,000 payment made by Waste Management in resolving the dispute over the treatment of landfill leachate — to help fill the gap in the general fund.Garner, who is the solicitor for the borough authority which was involved in obtaining the payment, abstained, and Toroney and Councilman Mark Gibson voted against the measure.Council also decided to take the administration's recommendations on delaying borrowing for a project to build new hangars at the airport and to continue three programs funded largely by grants but which require matching funds from the borough.
http://www.pottsmerc.com/articles/2008/12/10/news/srv0000004243059.txt
Wednesday, December 10, 2008 11:58 AM EST
POTTSTOWN — Borough Council Monday night made some, but not all, of the difficult budget decisions it faces, the most significant being a split vote to lay off 12 employees.If no other changes are made, the budget, as it stands now, would drive a 19 percent tax increase in 2009.With Councilwoman Maureen Allen absent Monday night, the deciding vote on the layoffs fell to Mayor Sharon Valentine-Thomas, who votes on council only to break a tie.Joining the mayor in voting to eliminate the positions were council President David Garner, Vice President Greg Berry and Councilman Stephen Toroney.
Council was unable to make a decision on two other controversial aspects of the administration's budget proposal — the elimination of the economic development director position and a 25 percent cut in funding to the borough's four fire companies — because no one was willing to second motions for either action.Berry made both motions, but to Garner's visible frustration, none of the other members of council was willing to give either motion a second. Thus, neither matter could be brought to the floor for a vote."I am a little frustrated," Garner told council members. He added that "I am not voting for a 19 percent tax increase.""Taxes were raised 25 percent two years ago and 9 percent last year. We need to do better," Garner said. "The reality is revenues in the borough are declining, and they are declining because the taxes keep going up."He aimed his frustration at the council's failure to make a vote on the economic development position."With a declining tax base and the economy the way it is, keeping in $180,000 to pay for economic development is not advantageous for our community," he said."Everywhere else, they are cutting positions; we don't have the luxury of keeping everyone intact."Prior to voting to proceed with the layoffs, Berry reminded the members of council that they are elected not to represent the borough's employees, but the taxpayers."We represent and answer to the taxpayers and only the taxpayers of Pottstown," he said."Do I think 19 percent is something this town can take? I'm not sure," said Assistant Manager Jason Bobst, who with consultant and finance director Timothea Kirchner had made the case for the cuts."What I am sure of is we're going to be in the same situation next year if we don't take action now," Bobst said. "Just since we started this process, we've lost $8 million in property value, and it's going to continue to slide and we're trying to use this process to dig our feet into the sand and start to push back."Prior to the vote, Karen Lewandowski, who chairs the Pottstown unit of the American Federation of State County and Municipal Employees, informed council that the union members "have presented council with an offer of a wage freeze to their current contract." She said the wage freeze would save the borough about $111,648.It is unclear if the matter was given consideration by council; although, the members did meet in a closed-door executive session to discuss, among other things, contract matters.When the matter was raised during the meeting, Garner dismissed it saying, "There's nothing there."Last week, Lewandowski told the council that as much as $300,000 in additional revenue could be obtained by charging a 10 percent late fee to septic haulers who are behind on their payments for taking septage to the sewer plant for treatment.Monday night, Bobst said the borough is moving to implement a percent fee as a penalty, but that care must be taken."It's difficult to build a budget on outstanding debt," said Bobst. "To some extent, we have to accept this as being part of the business we're in. That's why we only budget on an assumption of collecting 93 percent of all taxes owed.""We tried implementing fines a few years ago and as soon as we brought the hammer down, the hauler declared bankruptcy and we didn't see a dime, so we could be hurt in the long run," said Brent Wagner, the superintendent at the sewage treatment plant.Lewandowski was not the only union member to address the council. Code Enforcement Officer Dave Borzick, recognizing that the task before council is "a difficult one," urged them to "get all the facts, not just the information designed by a few individuals with their own agendas."He pointed out that the money-saving ideas the union has recently provided "have been ignored before and I would wonder why you would only be taking advice from the very individuals that have allowed these situations to occur over three years. It seems like more smoke and mirrors."Borzick ended by quoting Adolf Hitler, saying, "Make the lie big, make it simple, keep saying it and eventually they will believe it."Don Read also addressed the council, saying the problem Pottstown faces is "there are more tax users than there are taxpayers" and urged the members to "break the cycle.""I will tell you that the taxpayers have been brought to a boiling point, and I'm one of them," Read said. "When did a good paying job become an entitlement funded by the taxpayers?"Read, who is also a member of the Pottstown Borough Authority, told the council, "You do not represent labor, management, department heads, contractors or consultants. You represent the taxpayers."He found agreement with another member of the authority, Aram Ecker, who told the council, "Without exception, everyone is at their wits' end about how much it costs to live in Pottstown.""Back in the 1990s, we had 32,000 people in town and we had a payroll of 90 employees. Now we have 21,000 people in town and we have 180 employees. There is an exodus of people leaving Pottstown. You can't raise taxes 50 cents," he said.No budget decision will be final until Dec. 29, council's adjournment meeting, where the budget and tax rate will be officially adopted.Garner wants a few more decisions to be made."I am not satisfied this is a budget I'm ready to vote on," Garner said. "I am trying to turn over rocks because I think 19 percent is way out of line. I don't think we've done a real good job here."As a result, he convinced council to have another meeting to discuss the budget. It will be held Wednesday, Dec. 17, at 6 p.m. in borough hall. It was not immediately clear if the public will be allowed to speak.Despite Garner's comments, council did make some decisions. With a 3-2 vote, it decided to make use of $177,000 — left over from the $250,000 payment made by Waste Management in resolving the dispute over the treatment of landfill leachate — to help fill the gap in the general fund.Garner, who is the solicitor for the borough authority which was involved in obtaining the payment, abstained, and Toroney and Councilman Mark Gibson voted against the measure.Council also decided to take the administration's recommendations on delaying borrowing for a project to build new hangars at the airport and to continue three programs funded largely by grants but which require matching funds from the borough.
http://www.pottsmerc.com/articles/2008/12/10/news/srv0000004243059.txt
Monday, December 8, 2008
PCTV contributing to general fund, not draining it
Monday, December 8, 2008 7:44 AM EST
POTTSTOWN — As it turns out, PCTV is not losing money after all.When Assistant Borough Manager Jason Bobst and Timothea Kirchner, a financial consultant and interim finance director, began putting together the 2009 budget, one of the areas they found worrisome was a capital item to borrow money for, among other things, $300,000 worth of new equipment for PCTV.According to the audits from 2006 and 2007, Kirchner told council Dec. 3, PCTV had been running a deficit.But after meeting with PCTV chief Mark Pollock, she came to realize that at least until 2007, it was the other way around, and that it was PCTV that was helping to prop up the general fund.
"We keep peeling back the layers of the onion," Kirchner said.Beneath the outer layer, in which PCTV was going to require an infusion of cash from the general fund in 2009, Kirchner said she found that in 2004, council had transferred $150,000 into the general fund. In 2005, it was $200,000. In 2006, it went up to $250,000 and in 2007, it was $175,000."Essentially, over many years the general fund was drawing out of this enterprise to balance the budget," Kirchner said."Think of it, over eight years, PCTV has put over $2 million into the borough's general fund and we haven't cost the borough one penny to operate," Pollock told The Mercury.As a consequence of this deeper investigation, Kirchner said Pollock had re-submitted his budget, particularly given the drop in advertising dollars that have occurred as a result of the recession."But has also reduced his expenditures significantly," she said.As a result, the $63,000 that had once been penciled in as the general fund's contribution to PCTV has been eliminated from the budget proposal, Kirchner said.
http://www.pottsmerc.com/articles/2008/12/08/news/srv0000004215439.txt
POTTSTOWN — As it turns out, PCTV is not losing money after all.When Assistant Borough Manager Jason Bobst and Timothea Kirchner, a financial consultant and interim finance director, began putting together the 2009 budget, one of the areas they found worrisome was a capital item to borrow money for, among other things, $300,000 worth of new equipment for PCTV.According to the audits from 2006 and 2007, Kirchner told council Dec. 3, PCTV had been running a deficit.But after meeting with PCTV chief Mark Pollock, she came to realize that at least until 2007, it was the other way around, and that it was PCTV that was helping to prop up the general fund.
"We keep peeling back the layers of the onion," Kirchner said.Beneath the outer layer, in which PCTV was going to require an infusion of cash from the general fund in 2009, Kirchner said she found that in 2004, council had transferred $150,000 into the general fund. In 2005, it was $200,000. In 2006, it went up to $250,000 and in 2007, it was $175,000."Essentially, over many years the general fund was drawing out of this enterprise to balance the budget," Kirchner said."Think of it, over eight years, PCTV has put over $2 million into the borough's general fund and we haven't cost the borough one penny to operate," Pollock told The Mercury.As a consequence of this deeper investigation, Kirchner said Pollock had re-submitted his budget, particularly given the drop in advertising dollars that have occurred as a result of the recession."But has also reduced his expenditures significantly," she said.As a result, the $63,000 that had once been penciled in as the general fund's contribution to PCTV has been eliminated from the budget proposal, Kirchner said.
http://www.pottsmerc.com/articles/2008/12/08/news/srv0000004215439.txt
Borough workers bring cost-cutting ideas to council
Monday, December 8, 2008 7:44 AM EST
POTTSTOWN — With the clock ticking and borough council yet to make any of the wrenching budget decisions placed before its members by the administration, the president of the workers union stood up Wednesday to argue that some methods of saving money were being ignored by management.Karen Lewandowski, who heads the local chapter of the American Federation of Federal State and County Employees, provided information to council including a way in which more than $300,000 could be added to the coffers every year.Before she could provide that information, Councilman Mark Gibson had to buck Borough Council President David Garner's refusal to let her speak and force a motion to suspend the rules of the work session during which council normally does not take outside comments.Garner, was joined by Council Vice President Greg Berry and Councilman Stephen Toroney in voting against Gibson's motion.
Once allowed to the microphone, Lewandowski informed council that currently several companies that empty septic tanks and bring the contents to the sewage treatment plant for disposal, are behind in paying the fees they are charged.Last month, wastewater treatment plant superintendent Brent Wagner told the borough authority that four of those companies account for $174,000 that are overdue by more than 150 days and said he had put them on a payment plan.Lewandowski said, these companies are not charged the 10 percent interest fee that residential water customers who are late with their bills are charged.She said overall, the amount of fees past due for septic disposal are $250,171.52 and that charging 10 percent interest on those and other overdue bills could accumulate as much as $300,852 in additional revenue.That measure alone would cut nearly in half the $692,357 budget gap that stands in the current proposed 2009 budget, a gap that will require an 10.95 percent tax hike to close, even if council moves ahead with the drastic measures proposed, including eliminating five management and eight union positions and cutting contributions to the borough's four fire companies by 25 percent.Assistant Borough Manager Jason Bobst said without making the changes recommended by the administration, property taxes would have to be raised by 27 to 30 percent to close the budget gap.Bobst who, along with consultant Timothea Kirchner put together the current budget proposal, asked for permission to respond to Lewandowski's comments, but Garner said tonight's council meeting would be the proper venue.Lewandowski, whose union does not include the 43 members of the police union, also presented information indicating that the borough's higher-paid managers annually clock more overtime pay than the union workers.Since the managers are higher paid, this practice costs taxpayers more money, particularly when — as has happened numerous times in the past — the union files grievances over the way this violates the contract. Typically, the borough ends up settling these grievances by having to also pay overtime to the union workers who, under the contract, should have been called in, even though they didn't do any work.Because personnel matters are not public, Borough Manager Ray Lopez has in the past declined to indicate whether any of the managers who are allowing this practice to occur has been disciplined.Lewandowski's analysis of 2008 showed managers in the water department logging twice the over time of union workers — 211.75 hours; sewer department managers logging one and a half times more overtime than union workers and streets department managers logging one and half times more overtime than union workers.Her information packet included a salary list showing that the union's 65 full-time workers and five part-time workers cost taxpayers $2.7 million, with the average salary at $39,016.The highest paid AFSCME union workers on the list, code enforcement officer Dave Borzick, earned $47,382.40 in 2008.Her information also included a list of the borough's 26 managers (not including the police department), who cost taxpayers $1.6 million and earn an average of $61,872.Lopez is the highest-paid of these managers, expected to earn $93,712.50 in 2008.Lopez addressed a figure used during the Nov. 24 budget meeting when Lewandowski said with the lay-offs, the borough would have a manager-to-worker ratio of 2 to 1.Lopez, exempting four employees who are not in the union but are not supervisors, also included the summer workers hired in the summer and the borough's crossing guards in making his calculation and said when those employees are included, the ratio stands at one manager for every six workers."But we don't look at it that way, we look at it as a team," Lopez said.Gibson and Councilman Mike Wenzel were not buying what Lopez was selling."How can you look at it that way?" Gibson said angrily. "We're cutting full-time people and you want to count the seasonal workers who are here for two or three months?""I don't see how you can include the summer help and the crossing guards," seconded Wenzel.Whether the information Lewandowski provided will be taken into account by council members when making their decisions may not be known until tonight, when Garner promised Bobst and Kirchner that council would vote on a number their recommendations.The administration has already begun meeting with the workers who may be laid off in order to ensure that should that final decision be made, they will not appear on the 2009 payroll.One of those recommendations is the elimination of the Economic Development Director position, currently held by Terri Lampe. Wednesday night, Pottstown Memorial Medical Center CEO Steven MacLauchlan and Tim Phelps, executive director of the TriCounty Area Chamber of Commerce, said they would like to talk to the borough about coming up with a partnership that could ensure those functions continue. Both are members of the borough's economic advisory committee and spoke as such.On the subject of funding to the fire companies, Fire Chief Richard Lengel had made several proposals, including having firemen charge for the fire safety inspections they now conduct for free, as a way to prevent the 25 percent funding cut.Bobst said a 2.5 to 3 percent tax hike would be required to make up that funding cut, to which Mayor Sharon Valentine-Thomas responded "I'm advocating for that."Council set Monday, Dec. 29 at 6 p.m. for its annual adjournment meeting, making it the last day the budget can legally be adopted.The next meeting at which the budget will be discussed is tonight at 7 p.m. on the third floor of borough hall. It is the meeting at which the public is permitted to speak.
http://www.pottsmerc.com/articles/2008/12/08/news/srv0000004209158.txt
POTTSTOWN — With the clock ticking and borough council yet to make any of the wrenching budget decisions placed before its members by the administration, the president of the workers union stood up Wednesday to argue that some methods of saving money were being ignored by management.Karen Lewandowski, who heads the local chapter of the American Federation of Federal State and County Employees, provided information to council including a way in which more than $300,000 could be added to the coffers every year.Before she could provide that information, Councilman Mark Gibson had to buck Borough Council President David Garner's refusal to let her speak and force a motion to suspend the rules of the work session during which council normally does not take outside comments.Garner, was joined by Council Vice President Greg Berry and Councilman Stephen Toroney in voting against Gibson's motion.
Once allowed to the microphone, Lewandowski informed council that currently several companies that empty septic tanks and bring the contents to the sewage treatment plant for disposal, are behind in paying the fees they are charged.Last month, wastewater treatment plant superintendent Brent Wagner told the borough authority that four of those companies account for $174,000 that are overdue by more than 150 days and said he had put them on a payment plan.Lewandowski said, these companies are not charged the 10 percent interest fee that residential water customers who are late with their bills are charged.She said overall, the amount of fees past due for septic disposal are $250,171.52 and that charging 10 percent interest on those and other overdue bills could accumulate as much as $300,852 in additional revenue.That measure alone would cut nearly in half the $692,357 budget gap that stands in the current proposed 2009 budget, a gap that will require an 10.95 percent tax hike to close, even if council moves ahead with the drastic measures proposed, including eliminating five management and eight union positions and cutting contributions to the borough's four fire companies by 25 percent.Assistant Borough Manager Jason Bobst said without making the changes recommended by the administration, property taxes would have to be raised by 27 to 30 percent to close the budget gap.Bobst who, along with consultant Timothea Kirchner put together the current budget proposal, asked for permission to respond to Lewandowski's comments, but Garner said tonight's council meeting would be the proper venue.Lewandowski, whose union does not include the 43 members of the police union, also presented information indicating that the borough's higher-paid managers annually clock more overtime pay than the union workers.Since the managers are higher paid, this practice costs taxpayers more money, particularly when — as has happened numerous times in the past — the union files grievances over the way this violates the contract. Typically, the borough ends up settling these grievances by having to also pay overtime to the union workers who, under the contract, should have been called in, even though they didn't do any work.Because personnel matters are not public, Borough Manager Ray Lopez has in the past declined to indicate whether any of the managers who are allowing this practice to occur has been disciplined.Lewandowski's analysis of 2008 showed managers in the water department logging twice the over time of union workers — 211.75 hours; sewer department managers logging one and a half times more overtime than union workers and streets department managers logging one and half times more overtime than union workers.Her information packet included a salary list showing that the union's 65 full-time workers and five part-time workers cost taxpayers $2.7 million, with the average salary at $39,016.The highest paid AFSCME union workers on the list, code enforcement officer Dave Borzick, earned $47,382.40 in 2008.Her information also included a list of the borough's 26 managers (not including the police department), who cost taxpayers $1.6 million and earn an average of $61,872.Lopez is the highest-paid of these managers, expected to earn $93,712.50 in 2008.Lopez addressed a figure used during the Nov. 24 budget meeting when Lewandowski said with the lay-offs, the borough would have a manager-to-worker ratio of 2 to 1.Lopez, exempting four employees who are not in the union but are not supervisors, also included the summer workers hired in the summer and the borough's crossing guards in making his calculation and said when those employees are included, the ratio stands at one manager for every six workers."But we don't look at it that way, we look at it as a team," Lopez said.Gibson and Councilman Mike Wenzel were not buying what Lopez was selling."How can you look at it that way?" Gibson said angrily. "We're cutting full-time people and you want to count the seasonal workers who are here for two or three months?""I don't see how you can include the summer help and the crossing guards," seconded Wenzel.Whether the information Lewandowski provided will be taken into account by council members when making their decisions may not be known until tonight, when Garner promised Bobst and Kirchner that council would vote on a number their recommendations.The administration has already begun meeting with the workers who may be laid off in order to ensure that should that final decision be made, they will not appear on the 2009 payroll.One of those recommendations is the elimination of the Economic Development Director position, currently held by Terri Lampe. Wednesday night, Pottstown Memorial Medical Center CEO Steven MacLauchlan and Tim Phelps, executive director of the TriCounty Area Chamber of Commerce, said they would like to talk to the borough about coming up with a partnership that could ensure those functions continue. Both are members of the borough's economic advisory committee and spoke as such.On the subject of funding to the fire companies, Fire Chief Richard Lengel had made several proposals, including having firemen charge for the fire safety inspections they now conduct for free, as a way to prevent the 25 percent funding cut.Bobst said a 2.5 to 3 percent tax hike would be required to make up that funding cut, to which Mayor Sharon Valentine-Thomas responded "I'm advocating for that."Council set Monday, Dec. 29 at 6 p.m. for its annual adjournment meeting, making it the last day the budget can legally be adopted.The next meeting at which the budget will be discussed is tonight at 7 p.m. on the third floor of borough hall. It is the meeting at which the public is permitted to speak.
http://www.pottsmerc.com/articles/2008/12/08/news/srv0000004209158.txt
Tuesday, November 25, 2008
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."
http://www.pottsmerc.com/articles/2008/11/25/news/srv0000004129030.txt
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."
http://www.pottsmerc.com/articles/2008/11/25/news/srv0000004129030.txt
Sunday, November 23, 2008
Pottstown asks borough authority for car loan
Sunday, November 23, 2008 6:20 AM EST
POTTSTOWN — Not everyone can buy a new car, or maybe several new cars, without knowing where the money is coming from, but not everyone is the borough of Pottstown.According to information made public at Tuesday night's Borough Authority meeting, when the borough formally asked the Authority for a $686,000 loan, that is exactly what has happened.Assistant Borough Manager Jason Bobst and Timothea Kirchner, a financial consultant and acting finance director, laid the scenario out for the borough authority board members.
In August, Borough Council agreed to proceed on a number of capital projects, including a new Chevy Tahoe for Police Chief Mark Flanders and several new patrol cars.These vehicles, along with three new cars for the code enforcement department and new equipment for Pottstown Community Television and equipment for borough hall, were to be paid for through a "lease purchase" agreement with a firm named Municipal Services Group, identified by former finance director Robert Armelin.The cars and equipment were purchased, but the financial deal was never finalized, Bobst said.That's when the trouble began.Because the audit of the 2007 books was (and is) still not complete "and that caused (Municipal Services Group) to be skittish about loaning money to the borough," Kirchner said.The result was the potential for the borough to pay 4 percent interest on themoney, rather than the 2 percent originally proposed."The borough purchased the equipment in anticipation of the financing going forward," Kirchner said.Given that the borough's other option is to issue a general obligation bond, an expensive process for less than $1 million, Kirchner and Bobst said they felt obligated to explore a less expensive option.In response to questions from the authority, Kirchner made it clear that it is too late to give the equipment back and not spend the money."It's not the way I would recommend doing business in the future, but it's the situation we're in now and it keeps the money in the borough," Kirchner said.The borough offered to pay the Authority 3 percent over the five-year course of the loan.Borough Authority Chairman Ronald Downie thanked the staff for at least asking first."I appreciate that at least the borough is not going ahead and doing it without asking us," Downie said.Kirchner said although she and Bobst are attempting to clean up the borough and Authority budgets, as well as previous bad practices, she nevertheless recommended the move."I know you've heard promises in the past, but we're trying to change things going forward," she said."But how many finance directors do we have to go through?" asked Downie. "Every problem we run up against each time is essentially finance.""It's true," Bobst said, "that in years past an agreement to do things like this has been verbal, or never been offered at all, and that the borough has never paid the authority back. But this issue caught us off-guard."Off-guard or not, the Authority board did not appear anxious to agree to the deal."Our fiduciary responsibility is to invest our money in doing capital projects that enhance services for our ratepayers," Downie said. "I don't think we should be in the position of lending money."Authority member Don Read agreed, saying "my threshold question is how does this benefit our ratepayers? I would like to stay as a water and sewer authority only."Although the water and sewer funds combined have about $2.5 million in reserve, Downie worried that loaning some of that money out might crimp the authority's ability to continue with its capital budget program."I think that $600,000 would be better utilized on authority directed projects," Downie said. "I would rather use it to put solar panels up at the water plant because it would save our ratepayers money."Referring to the budget discussion that had just occurred, Downie said "why are we looking at increases for our ratepayers, would we loan money out for things that are not giving them a return?"David Busch, a financial expert with the authority's engineering firm, BCM, said there would be a return — $60,000 in interest."It's our view that we should strike the best deal we can on behalf of the community," Kirchner said.But Downie pointed out that the authority serves customers in the surrounding communities as well as just Pottstown. "We have ratepayers outside Pottstown and we are obligated to do what is best for our customer base," he said.Authority member Tom Carroll said he is reluctant because PCTV is not currently contributing to the general fund, but is a drain upon it, and he does not believe money should be invested in it."My biggest problem is how do we hold PCTV accountable to make money," Carroll said."I don't want the Authority to be the oversight committee for borough operations," Read replied.Referring to the mortgage meltdown fueled, in part by subprime mortgages, Carroll replied, "If you look closely at how some of the money that was lent to people in this country was spent, you might come to the conclusion that we should not have lent them money or we might not all be in the fix we're in."In the end, the Authority made no decision, agreeing to table the matter until more information on the proposal is gathered.
http://www.pottsmerc.com/articles/2008/11/23/news/srv0000004087962.txt
POTTSTOWN — Not everyone can buy a new car, or maybe several new cars, without knowing where the money is coming from, but not everyone is the borough of Pottstown.According to information made public at Tuesday night's Borough Authority meeting, when the borough formally asked the Authority for a $686,000 loan, that is exactly what has happened.Assistant Borough Manager Jason Bobst and Timothea Kirchner, a financial consultant and acting finance director, laid the scenario out for the borough authority board members.
In August, Borough Council agreed to proceed on a number of capital projects, including a new Chevy Tahoe for Police Chief Mark Flanders and several new patrol cars.These vehicles, along with three new cars for the code enforcement department and new equipment for Pottstown Community Television and equipment for borough hall, were to be paid for through a "lease purchase" agreement with a firm named Municipal Services Group, identified by former finance director Robert Armelin.The cars and equipment were purchased, but the financial deal was never finalized, Bobst said.That's when the trouble began.Because the audit of the 2007 books was (and is) still not complete "and that caused (Municipal Services Group) to be skittish about loaning money to the borough," Kirchner said.The result was the potential for the borough to pay 4 percent interest on themoney, rather than the 2 percent originally proposed."The borough purchased the equipment in anticipation of the financing going forward," Kirchner said.Given that the borough's other option is to issue a general obligation bond, an expensive process for less than $1 million, Kirchner and Bobst said they felt obligated to explore a less expensive option.In response to questions from the authority, Kirchner made it clear that it is too late to give the equipment back and not spend the money."It's not the way I would recommend doing business in the future, but it's the situation we're in now and it keeps the money in the borough," Kirchner said.The borough offered to pay the Authority 3 percent over the five-year course of the loan.Borough Authority Chairman Ronald Downie thanked the staff for at least asking first."I appreciate that at least the borough is not going ahead and doing it without asking us," Downie said.Kirchner said although she and Bobst are attempting to clean up the borough and Authority budgets, as well as previous bad practices, she nevertheless recommended the move."I know you've heard promises in the past, but we're trying to change things going forward," she said."But how many finance directors do we have to go through?" asked Downie. "Every problem we run up against each time is essentially finance.""It's true," Bobst said, "that in years past an agreement to do things like this has been verbal, or never been offered at all, and that the borough has never paid the authority back. But this issue caught us off-guard."Off-guard or not, the Authority board did not appear anxious to agree to the deal."Our fiduciary responsibility is to invest our money in doing capital projects that enhance services for our ratepayers," Downie said. "I don't think we should be in the position of lending money."Authority member Don Read agreed, saying "my threshold question is how does this benefit our ratepayers? I would like to stay as a water and sewer authority only."Although the water and sewer funds combined have about $2.5 million in reserve, Downie worried that loaning some of that money out might crimp the authority's ability to continue with its capital budget program."I think that $600,000 would be better utilized on authority directed projects," Downie said. "I would rather use it to put solar panels up at the water plant because it would save our ratepayers money."Referring to the budget discussion that had just occurred, Downie said "why are we looking at increases for our ratepayers, would we loan money out for things that are not giving them a return?"David Busch, a financial expert with the authority's engineering firm, BCM, said there would be a return — $60,000 in interest."It's our view that we should strike the best deal we can on behalf of the community," Kirchner said.But Downie pointed out that the authority serves customers in the surrounding communities as well as just Pottstown. "We have ratepayers outside Pottstown and we are obligated to do what is best for our customer base," he said.Authority member Tom Carroll said he is reluctant because PCTV is not currently contributing to the general fund, but is a drain upon it, and he does not believe money should be invested in it."My biggest problem is how do we hold PCTV accountable to make money," Carroll said."I don't want the Authority to be the oversight committee for borough operations," Read replied.Referring to the mortgage meltdown fueled, in part by subprime mortgages, Carroll replied, "If you look closely at how some of the money that was lent to people in this country was spent, you might come to the conclusion that we should not have lent them money or we might not all be in the fix we're in."In the end, the Authority made no decision, agreeing to table the matter until more information on the proposal is gathered.
http://www.pottsmerc.com/articles/2008/11/23/news/srv0000004087962.txt
Wednesday, November 12, 2008
'09 budget wrestles with $1.9M shortfall
Wednesday, November 12, 2008 9:15 AM EST
By Evan Brandt, ebrandt@pottsmerc.com
POTTSTOWN — Property taxes would go up more than 11 percent next year; 13 borough employees would lose their jobs, and all four fire companies would have their funding cut by 25 percent if the preliminary budget presented to Borough Council Monday night were to be enacted as is.The budget presented, however, is preliminary and unlikely to be adopted without change. What remains unclear is what changes may be made, seeing as the members of Borough Council had few specific comments about the proposal during the public meeting.One thing was clear to one member of council."It's very clear to me that the party in borough hall is over," said council Vice President Greg Berry, who also chairs the finance committee.
It was a sober presentation made two hours into the meeting before a standing-room only audience that had turned out to voice support for firefighters and borough workers, among other subjects.Despite waiting two hours to get answers and, in some cases, their jobs on the line, the facts presented quieted any audible discord.The presentation was made primarily by Timothea Kirchner, a consultant serving as the interim borough finance director."I know I'm not telling any of you anything new when I say that this is a challenging time for all municipalities," Kirchner said. "In Pottstown, you have significant challenges with a good economy; as it is, we are all going to have to make extraordinary decisions just about everywhere."When the management team sat down to put the budget together, it was quickly clear that Pottstown would face a $1.9 million budget gap in 2009 if cuts were not made and revenues not raised, she said.Closing that gap with a tax hike would have raised property taxes by 30 percent, Kirchner said, and the managers were unwilling to bring that to the council.There are a number of contributing factors of the borough's budget woes. The total assessed value of the borough's property has dropped and is expected to continue to do so in 2009.Further, she said, the 2008 budget was built on the assumption that 97 percent of the borough's property taxes would be collected, despite the history of the borough's collection rate being closer to 93 percent. That alone has resulted in a $300,000 gap in budgeted property tax revenues. Add to that a $275,000 shortfall in budget real estate transfer taxes and even the loss of revenues from PCTV.On the expense side of the equation, the borough faces a contracted 3.5 percent salary hike for the borough's union employees and is estimating an increase for police, who are currently in contract negotiations with the borough. Also, health care costs are expected to rise by 15 percent.This proposed budget does not include any salary increases for management and no increase in worker compensation insurance.Faced with these realities, the borough's management team made a number of recommendations, including the elimination of 13 positions -- five management positions and eight union posts. Included in the proposed management cuts are the code enforcement director, currently vacant; the economic development director, a post currently held by Terri Lampe; the streets supervisor, currently held by Al Shaulis; a parks maintenance supervisor and a projects coordinator.Cuts to union positions include an engineering inspector, service worker, police secretary, part-time parking enforcement officer, a codes enforcement officer, a full-time and part-time janitor, and an accounts clerk in the finance office.The borough could save $35,000 by contracting out for janitorial services and another $40,000 by contracting our for payroll services, Kirchner said.Other savings could be realized by eliminating borrowing for a proposed airport hangar project, cutting the night cleaning service, and enacting a 25 percent cut to Pottstown's four fire companies.The proposal also calls for using $177,000 of the $250,000 Pottstown recently received as part of its settlement with Waste Management over landfill leachate to close part of the gap in the general fund budget, the largest portion of the budget and the portion with the largest gap.With those changes, the budget gap shrinks from $1.9 million to $692,357.Of that gap, $430,309 comes from the general fund, Kirchner said. The fire budget makes up another $162,030 of that shortfall and with a debt service gap of $140,423 making up the third largest portion.Of the general fund's expenses, 55 percent is the police department and the other 19 percent the fire budget.Of note is the parks and recreation department, whose budget remained within its revenues with no gap under the proposal for 2009.Should Borough Council choose to adopt this budget as presented, it would result in a millage increase of 0.922864 or a property tax hike of 11.47 percent, Kirchner said.According to information provided by Kirchner, this increase would mean a $69.21 increase in 2009 over this year's bill of $603.63 for a home assessed at $75,000, just below the borough's median property assessment."We tried to keep the tax increase as low as possible," said Assistant Borough Manager Jason Bobst.With the council asking no specific questions, Bobst asked that members send him any suggestions about changes they would like to see in the proposal."We need to know what areas are sacred and what you don't want to cut, or what you would like to see cut more," Bobst said.While council did not ask questions about the budget, they did manage to get in a little sniping.Councilman Stephen Toroney, vice president of the previous borough council, took exception to Berry's comment about "the party in borough hall.""I guess I must have been around during the party, but the managers who were here and the council and I took our job seriously. It was not about play time," Toroney said.He said the economy has taken a serious turn and that it was this turn of events that is responsible for much of the pain outlined in the budget presentation."I stand by my comment," Berry replied."We're all adults here and I am sick of this beating up on each other," said Councilman Jody Rhoads. "We all have to work together."Councilman Mark Gibson agreed. "We're supposed to work as a whole, Democrats and Republicans, and these kind of comments aren't helping people," Gibson said.Looking at Berry, he added, "We're so much more efficient now than we were in the prior two years, but right now you're starting to sound like Jack Wolf" in reference to the previous borough council president.Borough Council President David Garner intervened and said, "Hopefully, we're all staying focused on the task at hand."Berry praised the clarity of Kirchner's presentation. "This is something that has not been seen in this borough in a long time," he said.What also has yet to be seen is when the next budget meeting will be held.Apparently unprepared that another budget meeting must be scheduled, the council members were unable to settle on a date.
By Evan Brandt, ebrandt@pottsmerc.com
POTTSTOWN — Property taxes would go up more than 11 percent next year; 13 borough employees would lose their jobs, and all four fire companies would have their funding cut by 25 percent if the preliminary budget presented to Borough Council Monday night were to be enacted as is.The budget presented, however, is preliminary and unlikely to be adopted without change. What remains unclear is what changes may be made, seeing as the members of Borough Council had few specific comments about the proposal during the public meeting.One thing was clear to one member of council."It's very clear to me that the party in borough hall is over," said council Vice President Greg Berry, who also chairs the finance committee.
It was a sober presentation made two hours into the meeting before a standing-room only audience that had turned out to voice support for firefighters and borough workers, among other subjects.Despite waiting two hours to get answers and, in some cases, their jobs on the line, the facts presented quieted any audible discord.The presentation was made primarily by Timothea Kirchner, a consultant serving as the interim borough finance director."I know I'm not telling any of you anything new when I say that this is a challenging time for all municipalities," Kirchner said. "In Pottstown, you have significant challenges with a good economy; as it is, we are all going to have to make extraordinary decisions just about everywhere."When the management team sat down to put the budget together, it was quickly clear that Pottstown would face a $1.9 million budget gap in 2009 if cuts were not made and revenues not raised, she said.Closing that gap with a tax hike would have raised property taxes by 30 percent, Kirchner said, and the managers were unwilling to bring that to the council.There are a number of contributing factors of the borough's budget woes. The total assessed value of the borough's property has dropped and is expected to continue to do so in 2009.Further, she said, the 2008 budget was built on the assumption that 97 percent of the borough's property taxes would be collected, despite the history of the borough's collection rate being closer to 93 percent. That alone has resulted in a $300,000 gap in budgeted property tax revenues. Add to that a $275,000 shortfall in budget real estate transfer taxes and even the loss of revenues from PCTV.On the expense side of the equation, the borough faces a contracted 3.5 percent salary hike for the borough's union employees and is estimating an increase for police, who are currently in contract negotiations with the borough. Also, health care costs are expected to rise by 15 percent.This proposed budget does not include any salary increases for management and no increase in worker compensation insurance.Faced with these realities, the borough's management team made a number of recommendations, including the elimination of 13 positions -- five management positions and eight union posts. Included in the proposed management cuts are the code enforcement director, currently vacant; the economic development director, a post currently held by Terri Lampe; the streets supervisor, currently held by Al Shaulis; a parks maintenance supervisor and a projects coordinator.Cuts to union positions include an engineering inspector, service worker, police secretary, part-time parking enforcement officer, a codes enforcement officer, a full-time and part-time janitor, and an accounts clerk in the finance office.The borough could save $35,000 by contracting out for janitorial services and another $40,000 by contracting our for payroll services, Kirchner said.Other savings could be realized by eliminating borrowing for a proposed airport hangar project, cutting the night cleaning service, and enacting a 25 percent cut to Pottstown's four fire companies.The proposal also calls for using $177,000 of the $250,000 Pottstown recently received as part of its settlement with Waste Management over landfill leachate to close part of the gap in the general fund budget, the largest portion of the budget and the portion with the largest gap.With those changes, the budget gap shrinks from $1.9 million to $692,357.Of that gap, $430,309 comes from the general fund, Kirchner said. The fire budget makes up another $162,030 of that shortfall and with a debt service gap of $140,423 making up the third largest portion.Of the general fund's expenses, 55 percent is the police department and the other 19 percent the fire budget.Of note is the parks and recreation department, whose budget remained within its revenues with no gap under the proposal for 2009.Should Borough Council choose to adopt this budget as presented, it would result in a millage increase of 0.922864 or a property tax hike of 11.47 percent, Kirchner said.According to information provided by Kirchner, this increase would mean a $69.21 increase in 2009 over this year's bill of $603.63 for a home assessed at $75,000, just below the borough's median property assessment."We tried to keep the tax increase as low as possible," said Assistant Borough Manager Jason Bobst.With the council asking no specific questions, Bobst asked that members send him any suggestions about changes they would like to see in the proposal."We need to know what areas are sacred and what you don't want to cut, or what you would like to see cut more," Bobst said.While council did not ask questions about the budget, they did manage to get in a little sniping.Councilman Stephen Toroney, vice president of the previous borough council, took exception to Berry's comment about "the party in borough hall.""I guess I must have been around during the party, but the managers who were here and the council and I took our job seriously. It was not about play time," Toroney said.He said the economy has taken a serious turn and that it was this turn of events that is responsible for much of the pain outlined in the budget presentation."I stand by my comment," Berry replied."We're all adults here and I am sick of this beating up on each other," said Councilman Jody Rhoads. "We all have to work together."Councilman Mark Gibson agreed. "We're supposed to work as a whole, Democrats and Republicans, and these kind of comments aren't helping people," Gibson said.Looking at Berry, he added, "We're so much more efficient now than we were in the prior two years, but right now you're starting to sound like Jack Wolf" in reference to the previous borough council president.Borough Council President David Garner intervened and said, "Hopefully, we're all staying focused on the task at hand."Berry praised the clarity of Kirchner's presentation. "This is something that has not been seen in this borough in a long time," he said.What also has yet to be seen is when the next budget meeting will be held.Apparently unprepared that another budget meeting must be scheduled, the council members were unable to settle on a date.
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