HomeMy WebLinkAboutMN-CC-1989-10-18IN�<I
1
COMMON COUNCIL PROCEEDINGS
CITY OF ITHACA, NEW YORK
Special Meeting 8:00 A.M. October 18, 1989
PRESENT:
Mayor Gutenberger
Alderpersons (8) - Booth, Hoffman, Johnson, Killeen, Nichols,
Lytel, Peterson, Schlather
ABSENT:
AlderpersQn Romanowski (excused)
Alderperson Cummings (excused)
OTHERS PRESENT:
City Clerk - Paolangeli
City Controller - Cafferillo
City Engineer - Gray
Cai Deputy City Controller - Thayer
Acting Superintendent of Public Works - Fabbroni
.t.4 Board of Public Works Commissioner - Reeves
Youth Bureau Director - Cohen
Fire Chief - Olmstead
Building Commissioner - Datz
PLEDGE OF ALLEGIANCE:
Mayor Gutenberger led all present in the Pledge of Allegiance to
the American flag.
MAYOR'S BUDGET MESSAGE:
Mayor Gutenberger expressed his gratitude to Dominick
Cafferillo, Steven Thayer and Barbara Ruane of the City
Controller's Office for all the many hours of work they put in
on the budget.
Mayor Gutenberger presented two documents to Council - the 1990
Mayor's Budget and his Budget Message.
Mayor Gutenberger made the following comments to Council
regarding the budget and the process that was used:
"The department requests which were submitted to the finance
department and me,had every one of the requests been granted,
would have required approximately a 58% tax increase. I wish to
point out that the budgets submitted by the departments were not
frivolous. They were well put together, well thought out, and
represented each department's view of what they felt they needed
to provide a high level of service to the entire community. In
almost every case these budgets were reviewed by the lay boards
that work with the various departments so they had some citizen
review as far as the lay board members.
However, with a 58% tax increase to start with, obviously we had
a lot of work to do. You have heard me and others say in the
last few years that tough days were coming -- well, the tough
days are here. If you thought the last few years were tough, as
they say - "you ain't seen nothing yet!"
In the previous years we have done everything possible to
increase revenues, to try to find other sources and new sources
of revenues. We just do not have that luxury this year. So,
with the wide gap between the budget and the departmental
requests and the communities ability to pay, we have reversed the
process this year. In the past we have taken the department head
requests, gone through and cut out items, whittled down where we
thought we could, put it back together and in most cases we would
not be too far apart. We would then have to go back through, go
back into the budgets and take out a little more once we knew
what we were looking for.
190
2
We started out with roughly a $3.7 million difference between the
requests and last year's budget. Thus, we just had to do
something different. What we did this year is to set aside
departmental requests and went first to the revenues and took all
of the revenues and stretched them to the limit. After doing
that and then applying the ultimate that we could determine in
revenues to the budget requests, it still would have required a
44% tax increase - this is after increasing revenues. Obviously,
that was not coming anywhere near close to closing the gap.
So I made a decision and asked Mr. Cafferillo to re -do the budget
requests with certain guidelines. And let me say, that by the
time we got done with even those 44% tax increases, we were still
looking for about $2.2 million to close the gap. To put that in
perspective, to raise taxes 1% only generates about $69,000.00.
So you can quickly estimate how many $69,000.00 it takes to come
up to even the $2.2 million. Each 1% raises very, very little
additional revenue when you are looking at this magnitude of
difference. So to see where we really were, I gave instructions
to delete all new position requests in all departments and to
apply to the 1989 budget the increase in salaries for all
existing staff that is already set by contract. As you know there
are still a couple of bargaining units that are in negotiations
right now. Let me warn you that if we were below on our
estimates of contract negotiations for those that are not
settled, that is going to make this picture even worse.
We then applied the known expenditures that we have no control
over, things for which we are already obligated. In addition we
held the line on all other expenses other than salary-, basically
the 200 and 400 lines, the equipment lines and contractual
services lines. We put into the 1990 budget the same dollar
amounts that existed in 1989. Knowing that we still weren't
going to be close, we eliminated all new capital projects. In
doing that - deleting all new positions, putting in known salary
increases, and putting in what we know we have to spend and no
additional monies for the 200 and 400 series and no new capital
projects,'�we came out with roughly $207,000.00 that was available
to spend above 1989. So that $2.2 million figure that we were
trying -to whittle down left us with $207,000.00. Obviously not
very much money.
What we did then is to not go through the usual, knock off a lawn
mower here, take out a paver or a garbage packer or those things.
There was so little money left for all the departments, that we
spread that $207,000.00 back through all the departments. We did
that basically on the break down of expenditures by departments
as they existed in 1989 and to let the individual departments
then prioritize how they want to spend their share of the
$207,000.00. Doing all the things I've just listed still
requires a 5.3% tax increase. To reiterate, no new positions are
recommended, no monies for capital projects, holding the line,
basically, on all expenditures still requires a 5.3% tax
increase.
What is going to happen? Obviously, a lot of discussions, a lot
of decisions have to be made. We will be sending back all the
budgets to the Department Heads showing what their total dollar
amounts would be under this scenario and asking the Department
Heads then to re- prioritize their requests, to stay within the
amounts allocated to them. It is going to be tough - it is going
to be hard. If a particular department feels that they cannot
live within that dollar amount after they have reprioritized,
obviously they will have to come to B &A and Common Council to
plead their case of why they should get more than the dollar
amount shown on the sheets. If those arguments are successful
then obviously Council has two choices. They can take that
increased amount and subtract it from some other department or
obviously raise taxes even more than the 5.3% or in this next
month and a half, which is not much time, try to identify even
19
fail
3
additional revenues than we have been able to identify.
There are a lot of tough policy decisions that have to be made in
this next month and a half. If the priorities, as far as
spending, stay the same as they have historically, (there is a
pie chart on the first page of the budget message which shows
percentages by departments that were spent in 1989), and if you
went back over the years, you probably would not find a great
fluctuation in that, maybe a percent or two here or there.
For every dollar amount over and above what you would want to
spend in a particular department, you are going to have to take
that corresponding amount away from some other department or find
new revenues or increase taxes even more. I guess the thing to
re- emphasize again is the fact that there are no monies in this
budget for new capital projects and there are things that we
should be doing. There are things I know that the various
departments want to do and feel very strongly about. There are
projects that individual Council members feel very strongly
about that should be done. The money is not in this budget for
any of those items."
.a
Discussion followed on the floor.
Alderperson Booth asked about tax increases for the last few
years.
Mayor Gutenberger stated that since he has been in office, tax
increases have averaged between 5 -7 %.
Alderperson Booth asked the Mayor to list any major new items
that the Council ought to be looking for. He said that he knows
the sludge and garbage is certainly a significant increase.
Mayor Gutenberger stated that garbage, sludge, and increases in
insurance is all significant. He stated that what you really
have to keep in perspective is to go back to the example that he
used of a 1% tax increase only generating $69,000.00. We know
we have lost federal revenue sharing, and the State revenue
sharing has been staying constant, and has not gone up at all in
4 - 6 years. Then we add into that, what we do with our own
salary increases. Roughly 67 - 68% of our total budgets are in
people, salaries and benefits. 5 to 6 to 6 -1/2% negotiated
settlements on salaries on top of the gap of level revenues are
things that we have no control over.
Mayor Gutenberger stated there is some good news in all of this,
otherwise we would even be in worse shape. The State of New York,
has informed us that because of new procedures, our cost for
retirement is less in 1990 than what it has been in the past -
quite a considerable chunk. Had that even stayed the same, we
would be in much worse shape than we are now. So there has been
a reduction in one of our major expenses, but even with that
reduction you see bad news like this.
Alderperson Nichols stated that he wanted to make it clear that
what the Council is talking about here does not include the water
and sewer fund. The cost of the sludge disposal will be coming
out of that fund.
Mayor Gutenberger agreed with Alderperson Nichols and stated that
other than sludge, the other landfill costs are in the operating
budget.
City Controller Cafferillo, for clarification, stated that in
regard to the retirement issue, what the State did was to take
two years of the retirement that the City would normally owe
(there is a 21 month back -log) and they financed that over 17
years so the City is paying a 1/17 payment annually to wipe out
those back years, plus paying the current liability so they did
1192
1.
4
not really lower the costs, they just borrowed a portion of the
costs and stretched it out. That did have an effect of about
$220,000 in our operating budget.
City Controller Cafferillo answered questions regarding the
City's debt service.
Alderperson Schlather stated, for clarification, that this budget
that is being presented includes all of the fire positions that
the Council added this past year, but does not include a single
new fire position for 1990. He said that if we wish to
implement the schedule of 5 or 6 fire fighters in 1990, that is
all new money.
Mayor Gutenberger said that is correct. The same holds true for
every department.
After further discussion Alderperson Schlather put forth the
following resolution.
Resolution
By Alderperson Schlather: Seconded by Alderperson Killeen
RESOLVED, That the Mayor's budget for 1990, as presented and
received by this Common Council, be referred to the Budget and
Administration Committee for review, which committee shall sit as
a Committee of the Whole Common Council.
Carried Unanimously
Alderperson Booth asked if there is any way to briefly summarize
what each City Department has asked for.
Alderperson Schlather responded that as you do the budget reviews
there will be detailed sheets from each department.
Adjournment
On a motion the meeting adjourned at 8:45 a.m.
allista F. Paolange i
City Clerk
John C. Gu enberger
/Mayor
J
IN�<I
1
COMMON COUNCIL PROCEEDINGS
CITY OF ITHACA, NEW YORK
Special Meeting 8:00 A.M. October 18, 1989
PRESENT:
Mayor Gutenberger
Alderpersons (8) - Booth, Hoffman, Johnson, Killeen, Nichols,
Lytel, Peterson, Schlather
ABSENT:
AlderpersQn Romanowski (excused)
Alderperson Cummings (excused)
OTHERS PRESENT:
City Clerk - Paolangeli
City Controller - Cafferillo
City Engineer - Gray
Cai Deputy City Controller - Thayer
Acting Superintendent of Public Works - Fabbroni
.t.4 Board of Public Works Commissioner - Reeves
Youth Bureau Director - Cohen
Fire Chief - Olmstead
Building Commissioner - Datz
PLEDGE OF ALLEGIANCE:
Mayor Gutenberger led all present in the Pledge of Allegiance to
the American flag.
MAYOR'S BUDGET MESSAGE:
Mayor Gutenberger expressed his gratitude to Dominick
Cafferillo, Steven Thayer and Barbara Ruane of the City
Controller's Office for all the many hours of work they put in
on the budget.
Mayor Gutenberger presented two documents to Council - the 1990
Mayor's Budget and his Budget Message.
Mayor Gutenberger made the following comments to Council
regarding the budget and the process that was used:
"The department requests which were submitted to the finance
department and me,had every one of the requests been granted,
would have required approximately a 58% tax increase. I wish to
point out that the budgets submitted by the departments were not
frivolous. They were well put together, well thought out, and
represented each department's view of what they felt they needed
to provide a high level of service to the entire community. In
almost every case these budgets were reviewed by the lay boards
that work with the various departments so they had some citizen
review as far as the lay board members.
However, with a 58% tax increase to start with, obviously we had
a lot of work to do. You have heard me and others say in the
last few years that tough days were coming -- well, the tough
days are here. If you thought the last few years were tough, as
they say - "you ain't seen nothing yet!"
In the previous years we have done everything possible to
increase revenues, to try to find other sources and new sources
of revenues. We just do not have that luxury this year. So,
with the wide gap between the budget and the departmental
requests and the communities ability to pay, we have reversed the
process this year. In the past we have taken the department head
requests, gone through and cut out items, whittled down where we
thought we could, put it back together and in most cases we would
not be too far apart. We would then have to go back through, go
back into the budgets and take out a little more once we knew
what we were looking for.
190
2
We started out with roughly a $3.7 million difference between the
requests and last year's budget. Thus, we just had to do
something different. What we did this year is to set aside
departmental requests and went first to the revenues and took all
of the revenues and stretched them to the limit. After doing
that and then applying the ultimate that we could determine in
revenues to the budget requests, it still would have required a
44% tax increase - this is after increasing revenues. Obviously,
that was not coming anywhere near close to closing the gap.
So I made a decision and asked Mr. Cafferillo to re -do the budget
requests with certain guidelines. And let me say, that by the
time we got done with even those 44% tax increases, we were still
looking for about $2.2 million to close the gap. To put that in
perspective, to raise taxes 1% only generates about $69,000.00.
So you can quickly estimate how many $69,000.00 it takes to come
up to even the $2.2 million. Each 1% raises very, very little
additional revenue when you are looking at this magnitude of
difference. So to see where we really were, I gave instructions
to delete all new position requests in all departments and to
apply to the 1989 budget the increase in salaries for all
existing staff that is already set by contract. As you know there
are still a couple of bargaining units that are in negotiations
right now. Let me warn you that if we were below on our
estimates of contract negotiations for those that are not
settled, that is going to make this picture even worse.
We then applied the known expenditures that we have no control
over, things for which we are already obligated. In addition we
held the line on all other expenses other than salary-, basically
the 200 and 400 lines, the equipment lines and contractual
services lines. We put into the 1990 budget the same dollar
amounts that existed in 1989. Knowing that we still weren't
going to be close, we eliminated all new capital projects. In
doing that - deleting all new positions, putting in known salary
increases, and putting in what we know we have to spend and no
additional monies for the 200 and 400 series and no new capital
projects,'�we came out with roughly $207,000.00 that was available
to spend above 1989. So that $2.2 million figure that we were
trying -to whittle down left us with $207,000.00. Obviously not
very much money.
What we did then is to not go through the usual, knock off a lawn
mower here, take out a paver or a garbage packer or those things.
There was so little money left for all the departments, that we
spread that $207,000.00 back through all the departments. We did
that basically on the break down of expenditures by departments
as they existed in 1989 and to let the individual departments
then prioritize how they want to spend their share of the
$207,000.00. Doing all the things I've just listed still
requires a 5.3% tax increase. To reiterate, no new positions are
recommended, no monies for capital projects, holding the line,
basically, on all expenditures still requires a 5.3% tax
increase.
What is going to happen? Obviously, a lot of discussions, a lot
of decisions have to be made. We will be sending back all the
budgets to the Department Heads showing what their total dollar
amounts would be under this scenario and asking the Department
Heads then to re- prioritize their requests, to stay within the
amounts allocated to them. It is going to be tough - it is going
to be hard. If a particular department feels that they cannot
live within that dollar amount after they have reprioritized,
obviously they will have to come to B &A and Common Council to
plead their case of why they should get more than the dollar
amount shown on the sheets. If those arguments are successful
then obviously Council has two choices. They can take that
increased amount and subtract it from some other department or
obviously raise taxes even more than the 5.3% or in this next
month and a half, which is not much time, try to identify even
19
fail
3
additional revenues than we have been able to identify.
There are a lot of tough policy decisions that have to be made in
this next month and a half. If the priorities, as far as
spending, stay the same as they have historically, (there is a
pie chart on the first page of the budget message which shows
percentages by departments that were spent in 1989), and if you
went back over the years, you probably would not find a great
fluctuation in that, maybe a percent or two here or there.
For every dollar amount over and above what you would want to
spend in a particular department, you are going to have to take
that corresponding amount away from some other department or find
new revenues or increase taxes even more. I guess the thing to
re- emphasize again is the fact that there are no monies in this
budget for new capital projects and there are things that we
should be doing. There are things I know that the various
departments want to do and feel very strongly about. There are
projects that individual Council members feel very strongly
about that should be done. The money is not in this budget for
any of those items."
.a
Discussion followed on the floor.
Alderperson Booth asked about tax increases for the last few
years.
Mayor Gutenberger stated that since he has been in office, tax
increases have averaged between 5 -7 %.
Alderperson Booth asked the Mayor to list any major new items
that the Council ought to be looking for. He said that he knows
the sludge and garbage is certainly a significant increase.
Mayor Gutenberger stated that garbage, sludge, and increases in
insurance is all significant. He stated that what you really
have to keep in perspective is to go back to the example that he
used of a 1% tax increase only generating $69,000.00. We know
we have lost federal revenue sharing, and the State revenue
sharing has been staying constant, and has not gone up at all in
4 - 6 years. Then we add into that, what we do with our own
salary increases. Roughly 67 - 68% of our total budgets are in
people, salaries and benefits. 5 to 6 to 6 -1/2% negotiated
settlements on salaries on top of the gap of level revenues are
things that we have no control over.
Mayor Gutenberger stated there is some good news in all of this,
otherwise we would even be in worse shape. The State of New York,
has informed us that because of new procedures, our cost for
retirement is less in 1990 than what it has been in the past -
quite a considerable chunk. Had that even stayed the same, we
would be in much worse shape than we are now. So there has been
a reduction in one of our major expenses, but even with that
reduction you see bad news like this.
Alderperson Nichols stated that he wanted to make it clear that
what the Council is talking about here does not include the water
and sewer fund. The cost of the sludge disposal will be coming
out of that fund.
Mayor Gutenberger agreed with Alderperson Nichols and stated that
other than sludge, the other landfill costs are in the operating
budget.
City Controller Cafferillo, for clarification, stated that in
regard to the retirement issue, what the State did was to take
two years of the retirement that the City would normally owe
(there is a 21 month back -log) and they financed that over 17
years so the City is paying a 1/17 payment annually to wipe out
those back years, plus paying the current liability so they did
1192
1.
4
not really lower the costs, they just borrowed a portion of the
costs and stretched it out. That did have an effect of about
$220,000 in our operating budget.
City Controller Cafferillo answered questions regarding the
City's debt service.
Alderperson Schlather stated, for clarification, that this budget
that is being presented includes all of the fire positions that
the Council added this past year, but does not include a single
new fire position for 1990. He said that if we wish to
implement the schedule of 5 or 6 fire fighters in 1990, that is
all new money.
Mayor Gutenberger said that is correct. The same holds true for
every department.
After further discussion Alderperson Schlather put forth the
following resolution.
Resolution
By Alderperson Schlather: Seconded by Alderperson Killeen
RESOLVED, That the Mayor's budget for 1990, as presented and
received by this Common Council, be referred to the Budget and
Administration Committee for review, which committee shall sit as
a Committee of the Whole Common Council.
Carried Unanimously
Alderperson Booth asked if there is any way to briefly summarize
what each City Department has asked for.
Alderperson Schlather responded that as you do the budget reviews
there will be detailed sheets from each department.
Adjournment
On a motion the meeting adjourned at 8:45 a.m.
allista F. Paolange i
City Clerk
John C. Gu enberger
/Mayor
J