He alluded to it during his State of the County address back in January, and in his second budget address Tuesday night, New Castle County executive Paul Clark confirmed next year’s fiscal budget includes no tax increase, no service cuts or layoffs and no dipping into the county’s reserves.
This is the second year the county has not used reserve money to balance the budget and the third in a row without a tax increase. Current available cash reserves total $52 million and $32 million sits in the county’s rainy day reserve.
Clark’s $166.6 million FY2013 operating budget is a 1.6 percent increase from FY2012, with an emphasis on public safety.
“From feedback from the public, from the citizens of New Castle County, public safety is important. So we’ve concentrated on that as much as we can,” said Clark. “We’re still investing in our parks and libraries, but it’s one of the areas we’re actually trying to grow.”
The budget includes an additional six police officers. The county says federal funds will cover their salaries and benefits, filling the positions come January. Clark’s budget also adds eight new 911 emergency operators, two sewer engineers and one Clerk of Peace staff position. Despite the additions, the county says it will have 1,562 employees next year, the fewest number of county employees in 11 years.
NCCo, however, faces a $5.1 million shortfall, in large part, because the housing market and new home construction continues to lag. According to the county, property taxes, real estate transfer taxes, permits and fees tied to land use account for 90 percent of the revenue the county collects. Clark warns the budget gap would have been $7.1 million but for $2 million saved through employee concessions next fiscal year, a voluntary sacrifice Clark commended during and after his address.
“We appreciate the shared sacrifice to which they and their unions agreed,” Clark said. “We asked for this 2.5 percent back. Over the last couple years, under the last administration, they gave 5 percent back, so they really have not had a raise in a while. But having said that, at the same time, they’re healthcare and their benefits have risen more than what they’ve given back.”
Coupling that with the increased costs of operating police and EMS vehicles because of rising gas prices and escalating employee healthcare costs totalling $21 million, up from $19 million in FY12, Clark explained a shortfall in FY13 year was inevitable. Consequently, using $1.7 million from NCCo’s real estate transfer tax reserve, $1.6 million in “stale money” from unused accounts, $700,000 in federal help, reductions through renegotiated health insurance and electric contracts and the elimination of vacant positions, the county was able to pare down the deficit.
“No one such efficiency balances the budget, but a whole series of them help a great deal,” Clark pointed out in his address.
Clark also proposed a $71 million sewer fund budget. The sewer fund covers day-to-day waste water and storm water systems expenses. There is no increase in sewer rates in the recommended budget and, it too, conserves available reserves, which holds $12.5 million.
Lastly, is the capital budget, which pays for things like construction and repairs of county facilities, sewer systems, parks and libraries. Clark is proposing a $17 million capital improvement program including $4.2 million to renovate and build libraries in Bear, Claymont, below the canal and in the Route 9 community. $400,000 is designated for a stand alone paramedic station on the grounds of Christiana Care’s new hospital complex in Middletown, $800,000 to upgrade paramedics’ lifesaving equipment and $330,000 for police body armor.
“Anytime you can get a budget that is, at least on paper, a balanced budget, that’s a good thing. It’s a positive first step,” said council president Tom Kovach, one of only three Republicans in county council. “What I didn’t hear about today, consolidation. What I also didn’t hear about today is addressing serious future costs, which are healthcare costs. We need to over the next year, we have a two year contract with employees, over this next year we should be looking on ways we’re self-insured, we need to look to ways to save healthcare costs. Our benefits costs are $0.50 on the dollar for employees, we need to lower that.”
Over the next six weeks, county council will hold budget hearings. It has until late May to approve the budget before it takes effect July 1.
Listen to reaction from Republicans Tom Kovach, NCCo council president, and councilman Bob Weiner in the video above.