To: City Manager Charles Strome III
Finance Commissioner Howard Rattner
Council Member Richard St. Paul
Council Member Albert Tarantino
Council Member Louis Trangucci
Fr: Mayor Noam Bramson
Council Member Barry Fertel
Council Member Roxie Stowe
Council Member Marianne Sussman
Re: Suggested Amendments to 2011 Budget
Date: November 28, 2010
We have reviewed the proposed 2011 budget with the goals of minimizing the additional tax burden placed on residents, preserving essential core services, and safeguarding the City's long-term fiscal health and stability.
The following amendments are offered for your consideration. If adopted, they would cut the proposed tax rate for 2011 by 1.63%, from 3.90% to 2.27%, while also increasing the unappropriated fund balance by $350,000 to a total of almost $3,000,000. The year-to-year property tax levy would actually decline by $738,598 or 1.52%, a larger percentage reduction than that proposed by the County Executive. Our suggested amendments are first summarized below, with a more complete explanation of each following.
Proposed Amendment Detail
Finance Certiorari Payments: Finance the projected $700,000 in certiorari costs, instead offunding these payments with cash. Under ordinary circumstances, cash payments would be preferable to the issuance of additional debt, but we note that the City has often financed these costs during times of fiscal pressure (including last year), that interest rates are exceptionally low, and that the City's overall bonded debt has declined significantly during the past decade. Split the resulting general fund savings between the 2011 tax rate and the unappropriated fund balance, in order to provide immediate relief to taxpayers, while better preparing for unanticipated events during 2011 and modestly strengthening the City's fiscal posture moving into 2012.
Reduce General Fund Subsidy of the Parking Enterprise Fund: Raise hourly rates at the New Roc City parking garage from $0.75/hour to $1/hour. This would generate an estimated $400,000 per year, with an equivalent reduction in the general fund subsidy of the parking enterprise fund. While the new rate would be very slightly higher than that of the White Plains City Center ($0.25/15 minutes vs. $0.25/20 minutes), the two facilities would remain roughly commensurate. (Note: A straight-line revenue projection would yield increased parking income of $533,000. We reduce this figure to $400,000 to conservatively account for both a marginal reduction in demand and for a phase-in period for meter re-programming.) Barring unexpected impacts on demand, this action would also provide recurring savings for the general fund in 2012 and beyond.
Increase the Marina PILOT: Increase the Marina PILOT from the current $75,000 to $100,000. As a general matter, we are skeptical of transfers from enterprise funds to the general fund, but make an exception in this case because the Marina fund is currently operating at a roughly $30,000 surplus and because a PILOT structure is already in place.