Hearing on budget Tuesday
Wednesday, August 28, 2013 1:00 AM
The amount of local tax revenue required annually to fund the city schools has surged by $1.2 million, or 65 percent, since 2000, an analysis by The Neshoba Democrat has shown on the eve of one of Philadelphia's largest tax increases ever.
A public hearing is set for Sept. 3 at 5 p.m. at City Hall on a proposed $7.4 million city budget that includes doubling general fund millage from 10 to 20 mills.
The tax increase that will generate about $565,000 is necessary to close the gap on six years of deficient spending, the mayor and board have said. The city has spent about $6 million more than it's taken in.
Contributing to the financial woes, Philadelphia has been spending about $380,000 annually since 2005 to cover its share of the
$6 million in park improvements debt.
Technically, school taxes aren't going up, but the bulk of what the city takes in from ad valorem taxes goes to the public schools.
The city currently levies 62 mills to fund the schools, 7 mills of that for debt service, which all total is expected to generate about $3,107,342 in fiscal 2014.
For comparison, the city levied 57.15 mills or $1,885,950 for the school district for fiscal 2000.
About 10 mills has been allocated for the city's general fund since 2000, going as high as 11 and as low as 8.7 mills.
Philadelphia School Board Chairman Ron Sparnecht said the new middle school construction combined with a reduction in state funding contributed to the need.
"The Mississippi Adequate Education program has not been fully funded in several years," he said.
Should the Mayor and Board of Aldermen adopt the proposed budget, a resident owning a home valued at $112,920 would see city taxes double, from $112.92 to $225.84.
That homeowner would continue to pay about $550.10 in school taxes.
The owner of a $152,000 commercial building would see city taxes increase from $228.30 to $456.60. School taxes on that property would remain about the same at $1,415.46.
Additionally, the tax increase will impact motor vehicles.
"The best way to voice your opinions on the budget is to call your alderman, call the mayor's office and show up to the next city meeting to let them know raising taxes and spending more is not the answer," said Kyle James in a comment on the Democrat's Facebook page.
The proposed general fund budget includes a modest pay raise for city employees totaling $49,546.
Revenue in the 2014 budget includes an additional $100,000 from Philadelphia Utilities in lieu of taxes. PU currently pays the city $212,000 annually.
Aldermen are projecting an increase in sales tax revenue to generate an additional $49,846.
The board plans to shift about $200,000 in TIF reserves for street paving. Street paving has been on hold for about six years.
Under the proposed budget, Police Department employees would receive a 63-cents-an-hour raise, while all other city employees would receive a 2-percent pay hike.
The mayor and board excluded themselves from the raises.
The raises do not affect employees with less than a year of service.
The proposed budget does not include any increases for the Arts Council, public library, conservation service or Main Street.
The Arts Council asked for an additional $2,000; library, $2,400; conservation service, $300 and Main Street, $12,000.
The city's 2014 budget does include a one-time $5,000 contribution to the parks to help fund additional lighting at the soccer complex.
Aldermen said the parks contribution is being matched by the Board of Supervisors.
The budget also includes a one-time additional $25,694 for a new truck in the street department to replace one that recently caught on fire under the hood and burned.
To generate new revenue for fiscal 2014, the proposed budget includes a $75,000 savings from the sale of a dump truck that is utilized at the landfill.
Aldermen agreed to sell the truck and purchase a used one at a lesser cost.
The consensus of the board was to further utilize the services of the county road department at the landfill.
In addition, the board hopes to save $1,750 in 2014 by paying the county to haul gravel to the landfill instead of an outside contractor.
Alderman included money in the proposed budget for the city to absorb 3 percent of a projected 15 percent in employee insurance premiums. No decision was made on how the remaining 12 percent would be funded.
The salaries of the Mayor and Board of Aldermen would remain the same under the 2014 budget. The mayor is paid $55,000 annually and aldermen, $13,800.
The city also pays their health insurance and retirement match.
Aldermen have projected about a $520,000 shortfall for fiscal 2013 which ends Sept. 30.
The fiscal 2014 budget would see the fire department budget increase from $1,458,416 to $1,499,420. The police department budget would decrease from $1,795,356 to $1,679,719. The street department's budget would increase from $691,011 to $735,953.
The general government budget would decrease from $2,632,028 to $2,442,062. Most of that reduction reflects a drop in grant monies.
Alderman-at-Large Willie Jackson said the city school district had reached its cap of 55 mills for operational needs.
"Basically, the city has to comply with that," he said. "It's not an option for aldermen.
"The tax that everybody pays now is 62 mills for the schools plus the 10 for the general operation of the city. It's on your tax bill broken down but most people like me just look at what you are paying."
Jackson said the additional 7 mills for debt service for the schools would eventually come off.
Sparnecht mentioned the city school district had completed a number of other projects over the years including reroofing the high school.