There’s at least one City Hall leader betting on a property tax increase for 2012.
Lawrence Mayor Aron Cromwell said Monday that he hasn’t yet seen a proposal that would allow the city to responsibly avoid an increase in its property tax mill levy. Based on preliminary numbers, 2012 city revenues are expected to be about $1.2 million short of expected city expenses.
“We’re faced with a budget that will demand either a substantial cut in city services or a mill levy increase,” Cromwell said. “I’m not comfortable cutting the services we would have to cut.”
City commissioners will dive into the city’s 2012 budget process this afternoon at a 4 p.m. study session at City Hall. The study session will include a presentation from the City Manager’s office that details 11 scenarios under which the city’s mill levy would need to increase for 2012. The scenarios contemplate a mill levy increase ranging from 1.7 mills to 4.6 mills. For reference sake, a 1-mill increase would add $23 in taxes to a $200,000 home.
Here’s a look at some of the issues driving a potential tax increase:
• An expanded Lawrence Public Library: Voters approved that project, so the mill levy increase will happen. Actually, voters blessed a 2.0-mill increase, but City Hall leaders are proposing 1.7 mills for 2012 and then the full 2.0 mills for 2013. That’s a recognition that the library won’t open until 2013, and thus the full amount won’t be needed until then.
• Increased compensation for city employees: Ten of the 11 scenarios included about $380,000 — or 0.4 mill — for increased compensation for city employees.
• Employee health care: The city estimates it needs about $700,000 — or 0.8 mill — to maintain its existing health care plan for employees. Currently city employees don’t pay a premium for their health insurance, although they do pay if they add their spouse or families to the plan. But commissioners are considering changing plans. The new plan would have higher premiums and deductibles for employees.
• Police detective: The city currently has a detective position that is funded largely through grant money. That grant is set to expire, but the city would like to keep the detective position. That would require $100,000 or about 0.1 mill.
• More police officers: New police Chief Tarik Khatib has told city commissioners that he believes the department needs more officers. One plan would call for one detective and four new police officers at a cost of $400,000, or 0.5 mill. Another option would add one detective, three sergeants and five officers at a price of $800,000, or 1 mill. A third option would add one detective, three sergeants and 10 officers at a price of $1.2 million, or 1.5 mills.
• Radios: The city is under a federal mandate to get all of its radios for police, fire, public works and the utilities department operating under a new band of frequencies. Radio replacement has been on the city’s to-do list for a number of years, but now the deadline is set to become an issue in 2012. To replace all the radios would be $2.08 million, or 2.5 mills.
The city does have one option for avoiding a property tax increase. The city has its version of a savings account — called a general fund balance — that has a little more than $12 million in it. Cromwell said he was open to using some of that money to pay for one-time expenses — such as the radios — but not for ongoing expenses.
And, of course, there are spending cuts. Corliss also will provide a list of areas where expenditures could be cut, although he’s not recommending them. Among the items that Corliss lists are:
• Cut social service agency funding by 50 percent. That would save the city about $280,000. The cut in funding would hit well-known social service programs, such as the Boys and Girls Club, the Ballard Center, the Lawrence Community Shelter, the Lawrence Arts Center and others.
• Reduce the city’s street paving program. The city in 2011 is expected to spend about $2 million on milling and overlaying city streets. Corliss said the city could choose to do less of that in 2012 but noted that improving streets was a top priority of residents in the recent Citizens Survey.
• Put a freeze on vehicle purchases. As currently crafted, the 2012 budget includes about $200,000 to purchase eight police cars. The commission could choose to push those purchases off for a year.
• Delay filling vacant police positions. The department currently has five vacant police officer positions. It has plans to start hiring those positions later this year. Corliss said the city could push that off and save about $290,000 this year, which could then be used to help offset the gap in 2012.
• Closure and reduced hours. Back in 2009, Corliss proposed several cuts that could be made if the city ended up losing about $1 million in state funding. The reduction in state funding didn’t materialize, but anger over the proposed cutbacks at City Hall did. Those proposed cuts included closure of the Prairie Park Nature Center, reduced hours for the city’s swimming pools and other recreation facilities, and defunding of the city’s crossing guard program. In a recent memo, Corliss said commissioners could consider those list of cuts again, but acknowledged that they were “highly unpopular” among the public.
Cromwell said he doesn’t think any of the possible cuts will get much traction with commissioners.
“I don’t think anybody believes there is anything on that list that makes any sense to cut,” the mayor said.