Constantine Minutes

February 28, 2011

 

The Monday, February 28, 2011 Budget Work Session began at 7:00PM in the Village Hall. In attendance: Trustees Robert Brewer, Willie Harder, Cindy LaFluer, Dick Larrance, Gary Mathers and President MacKenzie Strawser, Village Manager Mark Honeysett, Treasurer Donna Strawser and Clerk Ruth Strawser. Absent: Sarah Moore.

Manager Honeysett presented a 13-page revised 2011-2112 budget draft with most elected officials also using the previously presented 25-page budget draft (February 19, 2011) with the Salary Allocation Schedule. He pointed out that the latest draft pages were not sequentially numbered.

Discussion points led by the Village Manager:

  • Water Debt Service – the current 1 mill levy is sufficient to cover this bond payment. This debt might be paid off within the next two years, but not at this time and not with the accompanying premium/penalty for early closure.
  • Sewer Pipeline Debt Service(s) – these debt service millages must be increased to meet minimum debt service payment.
  • The Water and Sewer Funds are self-sustaining and revenue losses from Rexam’s departure should be offset by the associated drop in usage making the debt service payment fairly close. The total Debt Service revenue loss associated with Rexam’s departure is $59,000 ($13,200-Water Debt Service, $21,200-Sewer Debt #1, $24,500-Sewer Debt #2).
  • The Manager does not expect to follow through on the previously proposed sewer rate study/rate adjustment this year although he has yet to learn if the cured-in-place lining repairs have sufficiently lowered the infiltration levels.
  • The General Fund – the loss of approximately $116,000 in Rexam property tax revenues is substantial to this fund. Manager Honeysett proposed to raise the property tax millage by 1.0 mil to offset the loss.

Proposals from the Village Manager to balance the budget:

  • Lay-off one (1) part-time DPW worker and decrease one (1) part-time DPW worker’s hours to 16 hrs/week thereby saving the Village the cost of 24 DPW man-hours/week. The laid-off worker might be re-hired for temporary work on a job-by-job basis at $10/hour.
  • Scale back on the Police/School liaison officer 10-11 hours/week or have the school pick up the difference, unlikely since the school is being hit hard by Governor Snyder’s proposed tax cuts. This officer would remain as a part-time police officer.
  • Cut back to one (1) Village Council meeting per month thereby saving $6,200.
  • Increase the two (2) Sewer Pipeline Debt Service millages and the General Fund millage –2.5 mils, 2.5 mils & 11.5 mils respectively - resulting in an approximate average $160/year tax increase per household. If the Village Council decides not to raise the General Fund millage, he said he would be forced to lay-off one or two more employees (no specific positions mentioned). The Manager, Police Chief and full-time police officers work hours/compensation would remain unchanged, but all other staff would take a one-day/per month “furlough” resulting in a 5% pay decrease/per employee.
  • Eliminate the 4 th of July Parade & Fireworks thereby saving $225/hour x 4 police holiday-time man-hours and [average].
  • No cut to Village services although there may be some impact should there be more staff cuts. There may be effects if there are local and statewide cuts to emergency services.

Manager Honeysett said that the budget draft was incomplete, as he did not include the Major and Local Street Funds although he anticipated only negligible changes.

Discussion points led by elected officials:

  • Revoking the DDA $211,000 TIF (approx. $121,000 annually) to recapture [majority of] the money to the General Fund & Sewer Debt Services. The Village would assume the Incubator loan debt(s). (The remainder would be returned to the other taxing entities throughout the county.) The counter-viewpoint was that the condition of the downtown buildings & quality of Village life would suffer should that occur. Manager Honeysett said the Village would actually lose money because 60% of Diana Lammott’s employment package (approx. $30,000) and approx $48,000 in other DDA costs such as electricity for the historic lights and Christmas decorations, etc. would be passed on to the Village.
  • Keeping 4 th of July and dropping the Harvest Festival. Contracting for security services for festivals. The need to have officers available legally able to make arrests at such festivals. Making the DDA responsible for all festival costs associated with the Downtown/TIF District.
  • Closing the Village office 1-day/week. This should result in a 20% salary loss to general employees.
  • Increase employee “furlough” days to two/month. (This would have a major impact on general employee salaries of 10%.)
  • Ways to lower employee insurance cost. (All insurance increases have already been passed on to non-union employees.)
  • The police department contract wages/benefits have yet to be negotiated for this year. (Manager Honeysett doesn’t foresee any problems with their contract.)
  • Make cuts on the wages/benefits of Manager, Police Chief, DDA Director, Department heads. (Manager Honeysett said he averages 55-60 hours/week; based on a 50-hour workweek his average wage is $20/hour.)
  • Ask for voluntary [early] retirement of those most senior employees costing the village more in salary/benefits and hire in replacements at a lower wage.
  • Lay-off one (1) each: DPW worker, police officer, office staffer at an approximate savings of $60,000 minus approx. 1/3 in unemployment compensation.
  • Cut the Police Chief’s position and return to a combined Manager-Police Chief with a Police Lieutenant assuming day-to-day police department oversight. (Manager Honeysett said he would require a pay increase should he assume both jobs again.)
  • Contracting out some DPW work to save money.
    Reduce amount of contracted street sweeping.
  • Reduce engineering costs; forgo engineering studies where not strictly needed.
  • Possibility of already meeting Governor Snyder’s [future] requirements to re-capture part of the lost statutory revenue sharing – an Open Budget & Shared Services.
  • Questioned the reasonableness of some line item estimates such as fuel, utilities, maintenance, etc. The need to anticipate continued infrastructure [emergency] repair. (And why Dell Lawsuit money cannot be touched for other than sewer costs.)
  • Objections to a single monthly meeting based on timeliness of information &action necessary to conduct Village business. (May result in more special meetings or action taken without necessary Council approval.)
  • Effect of DPW lay-off on pending Riverview Grant projects/Land Acquisition. (The Manager said it would be negligible.)
  • The effect of increased millage rates on existing industry & business. (The Manager did not make those calculations.)
  • The reaction of village residents to increased taxes, sewer rates, etc.
  • The need for at least one more work session to discuss options.

There must be a Public Hearing on the proposed budget before its adoption. Adoption deadline is March 31, 2011. Special meetings will be set as needed.

Work Session ended at 9:05PM.

Ruth Strawser
Village Clerk