LARGO – After reviewing the budget, department by department, Aug. 16, Largo commissioners tentatively agreed with staff’s recommendation to include a 2.5 percent employee raise in a budget that accounts for a 5 percent increase in the property tax rate.
The tax rate and the budget for the 2013-14 year, which starts Oct. 1, must be approved by vote in two public hearings, scheduled Tuesday, Sept. 3 and Wednesday, Sept. 18, 6 p.m., at Largo City Hall, 201 Highland Ave.
The work session Aug. 16 allowed commissioners a chance to discuss details of the budget.
The 5 percent increase in the city’s property rate is in response to the stagnation of property values. Though the city is projected to experience the first increase – at 1.45 percent – in the property values after five years of decreases, the extra revenue isn’t enough to sustain growth. City administration is recommending the rate increase from 5.0 mills – or $5 for every $1,000 of taxable value – to 5.2 mills.
The budget also includes $830,600 in total expenditure reductions. These reductions include a 1 percent increase in employees’ contribution to the police and fire pension plan as well as eliminating empty positions of two groundskeepers, made up with the expansion of a grounds maintenance contract.
The proposed budget allows for 10 percent of the general fund to remain in a reserved balance.
If the commission were to choose not to increase the tax rate and if ongoing pension negotiations with police and fire unions don’t result in a reduction of expenses, the city will have to cut an additional $825,000 from the budget, and the general fund reserve balance would decrease to 9 percent, far below the city’s target amount.
Initially, city administration suggested a 2 percent tax increase for city employees, but that proposal was increased during the work session.
“Many of the competing employers around here are granting (pay) increases of 2 and 3 percent,” explained Assistant City Manager Harry Schubert. “Because of the good fortune of having no increase of premium for the health insurance and some other things that have gone on with the budget, we think it’s responsible at this time to ask for a 2.5 percent for all of our employees.”
The 2.5 percent increase to which the commission tentatively agreed will be offered in negotiations with the city’s three unions.
The city also will be able to budget money for one of three police officers positions currently unfunded and will add an administrative position with the Information Technology department.
The IT department has been overwhelmed, currently behind 18 to 20 months in backlogged projects, said its director, Harold Schomaker.
“We’re at the point where we can’t efficiently support that infrastructure,” he said, emphasizing the need for the commission to grant the additional position. “If not, we may have to ask to postpone some of these projects till next year.”
The commissioners disagreed on one point – whether the 2.5 percent pay raise would extend to their own salaries. Commissioner Michael Smith suggested that the elected officials forgo the increase in the coming year, as a way of showing solidarity with city employees.
“I totally disagree,” Mayor Pat Gerard said. “Before they stopped getting raises, we stopped taking raises, so I think we’ve shown our solidarity with the employees. We’re showing it this year, by trying to squeeze out another 0.5 percent (pay raise). We serve the city as well as anyone does.”
Largo commissioners made $13,126 this year. A vote will have to be taken during the public hearing to resolve the issue.
Also within the commissioners’ own budget is $10,000 set aside to fund nonprofit organizations of their choice. Last year, the fund went to the Pinellas County Homeless Leadership Board. This year, some of their requested money can be met within the city’s housing program, with only $6,000 needed from the commissioners’ fund, leaving an extra $4,000 to dole out to other organizations.
Office of management and budget administrator Amy Davis also presented the city’s goals for the future, which include increasing the reserve balance to 15 percent of the general fund and increasing the staff of the public safety and IT departments.
“Almost everything runs off computers now, so we really feel like we need to, on an as-needed basis, really keep in touch with what we’re doing technology-wise so that we are protecting the infrastructure that we have and also have the human support to maintain it,” Davis said.