WESTFIELD – The City Council members reviewed the budget with the goal of lowering the tax levy in November without having to use free cash or new tax revenue to prop up the tax rate.
Mayor Daniel M. Knapik has proposed a 2015 fiscal year budget that relies on both new tax revenue and the use of free cash.
Knapik’s budget package uses an estimated $340,000 in revenue from two new local taxes, that the Council has yet to approve, on meals and hotel rooms, and $2,140,000 from the city’s free cash account, to balance his budget.
The council members, attending a 4.5 hour marathon Committee of the Whole session, cut $3,711,439, with the expectation that much of that spending will be added back into the budget during the course of the 2015 fiscal year which begins July 1.
The largest budget cut approved by the council members on a 10-2 vote was to slash $3,232,772, roughly 25 percent or three months premium payments, from the city’s Health Insurance line item.
At-Large Councilors Dan Allie and David Flaherty presented arguments to support that vote. Allie argued that between the $2.4 million now in free cash, $4.2 million in stabilization, $4.18 million in a bond rebate of which $3.5 million becomes available to the general fund on July 1, he estimates that between $10.5 and $12.5 will be available at the end of the current fiscal year on June 30 to replenish departmental line items later in the year.
“We will have $10.5 million in December for health insurance, in the meantime the mayor will have nine months to work on this budget and he could still make the monthly premium payments,” Allie said. “Let’s put the ball in the mayor’s court to find a way to put the money back.”
Flaherty said the council needs to take a lesson from Knapik’s budgeting practices.
“During the whole budget review departments have been telling us that the mayor reduced or zeroed out line items and that they will be coming back to us looking for free cash appropriations,” Flaherty said. “It’s a shell game.”
“So let’s play the same game as the mayor to help the city’s taxpayers,” Flaherty said.
Mary O’Connell said her goal is to make as little an increase in property taxes, the city’s primary source of revenue because of chronic cuts in the levels of state aid, as possible when the council votes in November to set the tax levy.
“I really like that suggestion,” O’Connell said following Allie’s presentation. “If this gets us to a lower (tax) increase, let’s roll on it.
“We know we can’t deal with cutting or lowering the tax rate in November,” O’Connell said. “This is the time to do that. “We’re trying to maintain some control over the tax levy.
Flaherty said the $3.709 million cut “gives us the ultimate flexibility when we set the tax levy.”
Flaherty said that cut will enable the City Council to approve a tax rate increase of a half of a percent, rather than the 2 ½ percent required by Knapik’s budget.
