by Andy Stewart, Orangetown Town Supervisor
$81,000 in overtime savings and a $100,000 reduction in contracts with outside vendors are two of the reasons Orangetown Supervisor Andy Stewart says the proposed town budget will be under the NYS tax cap of 2%. Stewart says the average family should see a $47 annual increase in their 2015 Orangetown taxes.
The Supervisor’s budget is the first of three drafts of the Town Budget. The second draft is the Preliminary Budget, to be voted on by the Town Board on October 21, then there’s a public hearing on November 5 and the Town Board will approve a Final Budget on November 18. New this year, we’ve scheduled a tour of town facilities for the Board and set October 28 as a deadline for department heads to comment on the preliminary budget.
I believe this process — the debate, the public hearings, the votes — will produce a final budget we can all be proud of, and one which preserves what is great about Orangetown government, while challenging all of us to work harder, work smarter and work more efficiently.
Now to the bottom line: In this budget, the town will spend less in 2015 than 2014, and will stay under the New York State tax cap for the third year in a row! It is a lean, efficient budget that includes a very modest tax increase of just under 2% which for an average family should equate to an increase of just $47 on their town tax bill. This limited increase is solely to allow the town to meet rising mandated costs over which we have no control and to account for our limited use of fund balance compared to recent years. Again, overall spending is slated to decrease by $100,000, in part due to a 5% reduction in discretionary spending. We made many small cuts across all departments without taking an ax to any of the vital services that residents depend on. In short this is a prudent and fiscally conservative budget that cuts back on town spending and minimizes the burden on residents.
A Few Thank Yous from The Supervisor
“This Tentative Budget is based on months of collaboration between me, our finance team and the heads of the various town departments. I thank our department heads for the care you take in developing your budget requests, all the while knowing that I, the Town Board, and the public at large, are passionate about controlling the growth in taxes while also preserving vital services and our quality of life.
“I thank Finance Director Jeff Bencik who sat with me and examined every single line in this budget, expenses and revenues, often back to 2010, and called town staff on the phone frequently for more details when needed. While the Finance Department has been shorthanded since the departure of our longtime Supervisor of Fiscal Services Ann Maestri, the finance team, including Janice Ganley and Natalie Schutter has done a fine job supporting this budget process.
“I’d also like to thank Deputy Supervisor Allan Ryff and my assistant Elijah Reichlin-Melnick for their support and input during this process.”
— Andy Stewart, Orangetown Supervisor
Before I offer a few budget highlights, I want to take a minute to discuss the town’s basic financial situation: The town is fundamentally in good shape according to outside auditors, except for an accumulating golf deficit which we’ve started to address by contracting to have an outside management company run the Broadacres Golf Course. We have a great AA2 bond rating from Moody’s, and we have nurtured some fine economic development, such as our cluster of datacenters, and the supermarket and hotel at Orangeburg Commons. I’m also optimistic we could see some real progress with economic development at the Rockland Psychiatric Center property and the Pfizer site in the coming year and a new hotel in Nyack is already under construction and set to open in 2015. Our reserve fund balance remains strong and my tentative budget uses less fund balance than any recent budget.
Still, we pay among the highest property taxes in the country, and this is a big problem. Of course the majority of our high taxes are school taxes, but it is no comfort to me that the town is just a small portion of the overall tax bill — we have to do something about the budget we control. Unfortunately our hands are largely tied — the town’s budget is about 80% non-discretionary–for instance, pension rates set by the State Comptroller that keep increasing, health insurance costs that skyrocket every year, cost shifting by Rockland County to the tune of $500,000 a year, the unfair MTA mobility tax that will cost us $100,000 in 2015, not to mention salary increases locked in by union contracts. And please remember, the 20% of the budget that is so-called “discretionary” is not just “fat” that is overdue for trimming — it is stuff like fuel and salt for snowplow trucks, water and chemicals for the golf course, and vehicles for fire inspectors. Without much of this “discretionary” stuff, our wonderful and talented employees would not be able to do the things we pay them to do.
And let’s be clear, we all as town residents are getting a lot for what we pay. The town is clean, safe and beautiful, with great parks, friendly service in Town Hall, well-maintained roads, and a host of other benefits, including really smart, experienced and dedicated employees from the rank and file up through our management team. Taxes are indeed, as Supreme Court Justice Oliver Wendell Holmes once said, “what we pay for civilized society.” And Orangetown is a very civilized place, in many respects!
Now I’d like to take a few minutes to spotlight some of the key ways this budget “does more with less.” To start with I asked all town departments to show me budget options that keep costs in their departments flat, and I asked larger departments to present options for a 5% budget cut. I then reviewed these budget requests line-by-line with my finance team and looked hard for ways to spend less while remaining realistic about the cost of services. Following this review, spending is down on 281 budget lines (by an average of almost $11,000 per line), flat on 173 others, and up on only 115 lines. As mentioned earlier, we were able to cut 5% from the discretionary budget, for an overall expense budget that is $100,000 less than in 2014.
Some of the key cuts to discretionary spending include:
- An $81,000 cut to overtime expenses for town employees, which represents a 4% reduction from 2014 levels. The police and sewer departments have shown it is possible to reduce overtime through close management, and we need to continue and deepen this approach throughout the town.
- $100,000 reduction in contracts with outside vendors — the sewer department has started to do more work in house, and I’m proposing the parks department purchase a turf aerator instead of renting it annually in order to save money after two years.
- Small cuts of less than $10,000 in over 160 budget lines. These add up to almost a quarter million dollars in savings for town taxpayers.
- The deal the Town Board approved with Applied Golf to run Broadacres Golf Course has not only injected unprecedented marketing savvy into our golf program, it has cut the cost to the town by around $50,000 this year, and will yield additional savings in the years to come as Applied Golf’s investment in marketing pays off.
Because the town bonded $5.2 million for capital spending in 2014, I’ve cut capital spending to an absolute minimum for 2015, though this budget does include capital spending for a few projects that just can’t wait. These include: renovating two sewer pump stations, resurfacing some of the parking lot at Blue Hill, odor control equipment at the sewage treatment plant, and repairs to tennis courts at Veterans Park which would otherwise be unplayable.
On the revenue side of the budget, here are a few highlights:
- The town receives a small portion of the county sales tax and we have always been careful to avoid overestimating this revenue — but sales tax revenues this year are on pace to easily exceed the $1.35 million we predicted during last year’s budget process, so I’m proposing we budget for $1.65 million in sales tax revenues for 2015–an additional $300,000 relative to the 2014 budget, closer to what was received in 2013.
- The town is a popular place to make films and the Town Board is increasing permit fees based on the clerk’s recommendation, so revenues from filming should hit $200,000 in 2015. We’re also updating fees at the Building Department and Sewer Department to better offset expenses.
- Lastly, our investment in grant writing and lobbying really does pay off — we won a competitive grant for almost $2 million in state funds to improve pedestrian safety in the area of Pearl River Shoprite, and our work with Senator Carlucci and Assemblywoman Jaffee has resulted in New York State giving a half million dollars for the bridge project in Tappan, a quarter million for overhauling our aging sewage sludge filter press, and $150,000 for the Palisades sidewalk project. I look forward to pressing our case for funding of other important capital projects through the Tappan Zee Bridge project Community Benefit Fund, among other targets.
Finally, before I wrap up, I want to explain two significant decisions contained in this budget. The first is the decision to amortize our pension payments for the CSEA pension plan at a 3% rate over 10 years. Why amortize? If we had to pay the full cost of this pension plan this year it would cost an additional $1.08 million, which would force an extra 2.1% tax increase tax increase for residents or require us to take more from our reserve fund. I believe it is best to take advantage of this low-interest, no fee financing option now while the State Comptroller still allows us to, and save our reserve funds for emergencies. Finally, the State Comptroller says he’ll probably be reducing the cost to towns of funding the NYS pension system over the next few years, hopefully eliminating the need to amortize either pension plan.
Second, to get under the tax cap we need to use some fund balance, in addition to cutting spending and increasing revenues. For the final push to get under the cap my budget calls for the use of $250,000 from the town’s reserve fund. This is $1.5 million lower than any other budget since 2010. Moreover, our overall fund balance is strong, since conservative budgeting and tight fiscal management allowed us to avoid using the fund balance we thought we might have to in 2012 and 2013. At of the start of 2014, the town had $20.4 million in fund balance, an increase of almost $4 million since 2012 when the town had $16.6 million in reserves.
By way of concluding this presentation, I want to mention several new revenue-producing projects which are in discussion or in development and which I hope will soon yield significant benefit for the town though they are not yet ready for actual inclusion in the budget:
- An arrangement whereby the town is paid to run its backup generators during periods of peak electrical demand which will bring us $100,000 a year in new revenues.
- A compressed natural gas station to be located adjacent to our Drop Off Center, that will net the town about $100,000 per year in lease and royalty payments, as well as access to cheaper fuel as we convert trucks and cars to run on Compressed Natural Gas.
- A deal for the town to buy its streetlights back from Orange & Rockland and convert them to more efficient LED bulbs–this change could save us about a quarter million dollars a year.
All in all, my budget does what I believe the taxpayers of this town demand: it holds the line on town spending, preserves the public services we enjoy, and most importantly, it stays under the New York State tax cap.
As this process continues, I look forward to receiving input from Orangetown taxpayers and to working constructively with my colleagues on the Town Board and town staff to produce a final budget that we can all be proud of.
Andy Stewart is the Town Supervisor of Orangetown, NY.