[RP TownTalk] Budget and taxation

Tue May 15 20:16:31 UTC 2007

Friends and Neighbors,

I want to provide some information about the budget proposal I have sent to
the council and provide you with some tools so you can understand what it
would mean for you.

*How Will Your Taxes Change*
To get a close estimate to what the change in your personal tax will be if
the Council accepts my proposed tax rates you can do this quite easily

1. go http://sdatcert3.resiusa.org/rp_rewrite/searchtype.asp?form%24=SelectCounty&county=17&SearchMethod=Street
 and enter your street address.

2. In the results go down to the Value Information and if you have been in
your house for one year or more multiply the 2006 total by .1 and then plug
the result into the the formula  (Answer/100) X .687=annual tax change.  For
my house the answer is $144 or about a $12 addition to my monthly mortgage
payment.

If you have not lived in your house for a year, or for property that is not
your personal habitation subtract the 2006 total from the 2007 total and
again use the formula (Answer/100) X .687=annual tax change.

As part of the research of getting a budget proposal out, I did a number of
calculations for random houses around town.  What I found was that almost no
owner occupied property saw more than a $15 per month personal increase. The
vast majority were below $13.

Is this important? Of course it is. Is this a significant burden on
most?  You will have to answer that for yourself.

*What Can You Do If Your Property Taxes Are a Significant Burden?*

Whether or not there is any town tax increase this year, if your total
household income is less than $60,000 per year you should visit
http://www.dat.state.md.us/sdatweb/htc.html
 for information about the Homeowners Property Tax Credit Program. It is
particularly important to share information about this program with our
seniors and those with health or related problems.  There is relief for
those who are stretched, but they do have to file.

*Constant Yield Tax Hearing and Budget Hearings*
**
On Monday the 21st we will hold our first meeting in the process that will
culminate in the budget for FY 2008.  This meeting will consist of two basic
parts. 1) I will make a presentation to the public about what the Constant
Yield Tax requirements are and an overview of my budget proposal; 2)
questions and comments will be taken from the public about the tax rates and
financial maters of the town.

While the few emails so far suggest that this meeting might get a little bit
contentious I want to extend a hearty welcome to everyone.  Frankly having
some folks show up will be a nice change from the last two years.  No one
from the public showed up either year.

There will then be a series of Finance Committee meetings through June to
arrive at our final budget no later than June 30. The Council will
ultimately decide what the budget will be, based on testimony from myself,
the staff, and the public.  All meetings are open to the public and will be
posted on Town Announce and outside the Town Hall.

*Budget Outline Is Attached
*

Attached you will find a copy of my budget proposal.  Please take some time
a review it.  In particular you might note the following:

On the Revenue Page:

 State resources (such as State Aid for Police, State Highway Funds, etc)
are flat when comparing FY 2007 and 2008.

Business tax resources/licenses and fees are flat or have declined. The
biggest hit we took was from the withdrawal of PNC Bank Tangible Property.
In addition we will likely take a $270,000 hit from that bank as they seek
a refund of taxes they claim to have overpaid in years past. This won't come
out of this years budget per say, but it makes a big whole in our operating
reserves.

Almost all other resources are flat.

In the cost categories you will will notice:

That benefits in particular have gone up, and that is a reflection of
unexpectedly high  workman's compensation rates.

Also, in doing the civilian classification system we found several positions
were compensated substantially under regional averages, so this year the
salaries show increase beyond the 4% increase based on the merit system and
COLA.

Fuel and Utilities place upward pressure on budget.

Capital Budget.  When you look at the last page you will see that only one
item is for new spending and it represents a tax of 1.6 cents.  All other
items were passed in previous years.  What is somewhat deceiving is that
last year we only made one half an annual payment on both our street and
building projects, so this year the rate almost doubles since we have to
make a full year's payment.

*Options?*

There are always other options.

We still have a substantial reserve fund that we can utilize.  However, I
see reserves as something to utilize during economic distress, not the
relatively good economic times we are in now. Therefore, I only suggest
spending reserves (unappropriated surplus) down to a point that is roughly
three months worth of operating expenses.

Also, we can start reducing services.  From what I can tell, most of us want
at least the level of service we currently have, if not more still.

Best wishes,

Vern

-- 
Vernon Archer, Mayor
Town of Riverdale Park, Maryland
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://riverdale-park.org/pipermail/towntalk/attachments/20070515/6ea186a6/attachment-0003.html>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: 07-08BudgetSemiFinal_Mayor.xls
Type: application/vnd.ms-excel
Size: 57856 bytes
Desc: not available
URL: <http://riverdale-park.org/pipermail/towntalk/attachments/20070515/6ea186a6/attachment-0003.xls>