|Berquist: Balancing budget will be painful|
|Saturday, August 03, 2013 12:00 AM|
BY NANCY SPENCER
DELPHOS — No one solution is “the solution” for the city’s budget woes, according to Delphos Safety Service Director Greg Berquist.
The city will lose revenues of approximately $865,000 in utilities from the closure of Reser’s Fine Foods in September, lost more than $400,000 in utility fees when Chef Solutions filed bankruptcy in 2013 and lost $60,000 in income revenue when I&K Distributors was sold to Lipari Food. The city has also seen reductions in Local Governments Funds from the state. The city received $240,000 in LGF in 2008 and in 2013, received $79,000. The elimination of the Inheritance Tax cost the city $70,000 in funds.
Before factoring in the loss of Reser’s, the 2014 Budget was nearly $300,000 in the red in the General Fund. That also has to be made up somewhere as the city cannot operate with a negative balance.
“The proposed income tax increase doesn’t solve all our problems, raising rates doesn’t solve them and laying people off doesn’t solve them,” he said Friday. “Laying off police officers doesn’t add to the Water Fund and laying off a firefighter doesn’t make the Sewer Fund larger. With the division of funds and laws governing what you can and can’t do with them, a combination of many things is going to have to happen and none of them are painless.”
The utilities loss can only be replaced by another food-processing industry in Reser’s place, an income tax increase or rate increase — or all three.
“Those are the only things that will make those funds look better,” Berquist said. “We have been in contact with Reser’s on a regular basis for the last several weeks trying to get them to tell us things about the building and let us in there to get specs so it can put on the state and regional websites. We are not their priority and they still have nearly two months to go.”
The proposed .25-percent income tax increase would generate approximately $400,000 annually, still leaving $465,000 to recover from lost services. Income tax collections were $2,461,628 in 2010, $2,485,366 in 2011 and $2,496,700 in 2012. This year’s income tax collections from January through June are $1,678,134. The 2010 collections for those same months was $1,645,274; 2011 - $1,683,841; and 2012 - $1,708,367.
Personnel is the city’s biggest expense and the hardest to cut.
“You have to have key personnel on duty at certain times,” Berquist said. “When we are generating water, someone has to be at the water plant to monitor the system and do lab samples. The EPA mandates a person of charge must be at the wastewater treatment plant 40 hours a week. There has to be a platoon chief and secondary person on station at the fire department for each shift.
“We just can’t go in and cut people. They have to be the right people.”
Berquist handed out a memorandum at Tuesday’s meeting, including a list of options and their savings. A furlough day per employee each week in all departments with an estimated $480,000 savings (but does not provide enough man-hours to keep the water and police department operational); a furlough day for each employee per pay period (15 days) with savings of $240,000 was on the list.
Of the two, Berquist said the second option is more feasible.
“When you go to a furlough day a week, you start to lose key employees and then can’t afford to replace them and are not attractive to applicants,” he said.
Berquist said the city has been trimming employees since 2009. Kim Riddell’s position of wastewater treatment plant superintendent was filled from within the plant and that vacant position was not filled. When Police Chief Dave Wagner retired, his position was also filled from the department ranks and the opening left was not filled. Bev Cross-McNeal’s position has not been filled and when Maintenance Supervisor Dave Metzger left the city payroll, his position was filled from within and that empty spot was absorbed into the existing personnel. The Parks Department has trimmed six seasonal personnel in the last two years.
“We have been doing what we can to save money and make do with what we have,” Berquist said. “We’ve made our utility plants as efficient as possible and are still looking at energy-saving measures. We have been addressing issues as we see them coming. We didn’t see this Reser thing coming. The last we talked, they were adding a line and everything was OK.”