Budget Talk and Moody’s AAA — Rye City Council Minutes from November 5, 2008
Rye city council minutes, penned by City Clerk Dawn Nodarse, have been published for the November 5th meeting. Here are the highlights. Mayor Otis (who arrived at 8:07pm) and all the council members were in attendance.
- Presentation of 2007 Financial Trends Report. City Comptroller Genito summarized the 2007 Financial Trends Report. The report covers a ten-year period tracking financial indicators and ratios from 1998 through 2007. The report did note certain things that were happening such as the decline in mortgage tax revenue and interest earnings, which are two major sources of revenue. Mr. Genito said all of the financial ratios regarding the City’s financial position are very sound. Current ratios are high, the liquidity ratio is high, the fund balance as a percentage of expenditures is very high and the City is well above the targets that are standard across the Country and considered best practices.
- Enterprise Funds. The City has two Enterprise Funds, the Boat Basin and the Golf Club, that are operated like businesses. The two funds have a priority of making sure that they cover all of their expenditures, including debt service, capital improvements and all operating expenditures. Both funds have done this as well as decreasing the burden on the taxpayer by paying back to the General Fund general administrative overhead charges. The Boat Basin built up a sizable fund balance for the dredging process that is currently underway and will probably cost $2 million. The Boat Basin will be able to pay for the project without issuing any debt or borrowing any money. The Golf Club has also been covering its own costs and paying off the debt issued for the renovation of Whitby Castle in 1998 (over $400,000 a year) as well as other improvements to the Golf Course.
- Moody's AAA. Moody’s, the investor service that rates the City’s bonds, has given the City’s bonds a Aaa rating, the highest rating for a municipal bond. Rye is one of the few municipalities in New York to receive this rating and Moody’s cited the Financial Trends Report as something that goes well beyond what most communities do.
- Otis and Pratt Comment on FY 2009 Budget. It is hoped that the full impact of this economic downturn will not be as bad as in 2001-2002 but the Council has asked the City Manager to cut many things before the budget is presented and eliminate things that can be deferred, in order to keep the tax increase as low as possible. In November 2006, the New York Times rated the City as the third lowest cost government in Westchester County in terms of providing services in an efficient way. Councilman Pratt said there were a couple of important statistics that he wanted to bring to people’s attention: the number of municipal employees as well as the City’s population has remained fairly stagnant in the last ten years. Property taxes make up 63% of the budget and 97.3% of that amount goes for salaries and benefits, which means that 37% of the total budget is variable coming from elastic revenues such as mortgage tax and state aid and that is the percentage of the budget that is in play. He also noted that 2009 salaries and benefits are approximately $19 million, or about the same amount as the tax levy. This means that City taxes pay only for salaries and benefits of City employees and everything else is paid for by other sources of revenue.
- Presentation of the FY 2009 Budget by the City Manager. Mr. Shew began by saying that this budget is 16 cents on the tax dollar down from a high of 19 cents in the past. Mr. Shew said it is more useful to talk about dollars than percentages because as the City becomes a smaller part of the tax dollar, percentages do not tell the entire story. The City is primarily a service organization, providing such services as police and public safety, garbage pickup and recreation. The majority of the money in the budget focuses on people and services. The budget is moving in two directions: one where expenses are increasing (such as the cost of electricity for street lights, which will cost over $100,000 more next year) and the other where revenues are decreasing. Prior to September 15, 2008 a different budget would have been presented but due to the economic changes in the world since then the budget being presented has changed. The Council has directed staff to provide a realistic budget and, therefore, staff has cut over $1 million from the pre-September 15th budget. The changes made will focus on recurring expenses as the City goes forward. Fund balance will not be used to fund recurring costs such as salaries. The City will continue to scrutinize all positions before filling them and several positions have been eliminated in the last several years.
- 16 Cents on the Dollar. Shew gave an overview of some things that the 16 cents on the dollar has provided to the community by various entities:
- Department of Public Works: The reconstruction of Theall Road and the negotiation of an agreement for additional parking for Rye Manor residents; The completion of the Kirby Lane North sewer project, which will be paid for by the residents but required hundreds of hours of time expended by City staff; The Boston Post Road diet project; Flood-related projects Maintenance of sewer lines, storm drains, pump stations, parking lots, streets and sidewalks.
- Police Department: Renovation of the Police Department building; Relocation of a generator to power building during emergency conditions; Studied options for Police/Court facility; Responded to 12,182 calls for service, issued 2,700 moving violation summonses, 6,500 parking tickets, made 285 arrests on 625 charges; There are 39 sworn officers in this budget, a reduction of one from 2008; The Reverse 911 has been upgraded; The Department successfully continued its accreditation, one of few departments to be accredited; The respect manual was updated; Members of the Department were trained in the use of defibrillators and advanced first aid and are now Certified First Responders Class D.
- Fire Department: The Department, in conjunction with the Building Department, improved the Insurance Services Office (ISO) rating (from 5 to 4), which gives residents a better rate on fire insurance rates; The Department is evaluating the best way to purchase equipment relative to the needs of the community and public safety; The Department is attracting more and more diverse volunteers.
- Recreation: Sally Rogol has succeeded Bill Rodriguez as Recreation Superintendent; Many programs are offered for both children and seniors; The Department returns 47% of its costs through program fees or donations lessening its dependency on tax dollars.
- Nature Center: Now operated without municipal employees.
- Rye Free Reading Room: A not-for-profit operated by an independent Board of Directors; More dependent on tax dollars in recent years.
Mr. Genito said that the proposed 2009 budget adheres to the adopted financial policies. Operating expenses are covered by operating revenues. Recreation revenues return 47% of their expenditures, which is above the target levels expected by the City Council. A Contingency of $300,000 represents at least 1% of the expenditures and is included in the appropriations. Available fund balance is used for capital and equipment costs and the fund balance after these purchases, is projected to remain well above the 5% of appropriations mandated by our financial policies. Mr. Genito cautioned that, at this time, there are still many unknowns that could affect the assumptions and estimates made in the development of the proposed budget, including changes in State Aid; actions by the Federal Reserve that could require the City to recalculate projected interest earnings; the volatility of the commodities markets that could change the costs of materials and supplies, and market liquidity, interest rates and consumer confidence that could affect the outlook for sales and use taxes, mortgage taxes and building permit revenues. 2009 is a year that requires deep reflection and responsible planning for 2010 and beyond, with an eye toward maintaining core services and preserving capital for future needs.
<< Otis and Pratt Comment on FY 2009 Budget. It is hoped that the full impact of this economic downturn will not be as bad as in 2001-2002 >>
oh my gosh . can these folks be serious ? Rye finances are doomed if they are actually making decisions based on even a remote hope that 2001-2002 was as bad as current collapse . Then again , from Gov paterson on down to little Rye , from mayors to unions still demanding pay increases while tax payers lose their jobs , denial of what is underway will only make it far worse in 2009 – 2010 .
Hint to Rye politicians : this is going to be every bit as bad as the 1930’s in Rye only we start in much weaker financial condition and with state / municipal workers in full belief they are entitled to steady pay hikes and retirement benefits that none of us in private sector can dream of .
You will see empty homes in Rye and food lines in NYC before this is over and our leaders haven’t a clue .
Ever see videos of the tsunami in Thailand a few years ago ? as the tide went out far below normal levels , many wandered down to the beach while a few wiser ones began running the opposite way in full knowledge of what was coming next ( the wave ) . Our politicians are like the folks running down to to the water edge for a look ….smiling …..oblivious to whats next .
Garnet Grad : oh yes …very well aware . Did you know the teachers in Rye still walking around with big NO CONTRACT buttons outraged their already miles above average teacher salaries not getting another bump higher ? How is it towns like Madison , CT can churn out standardized test scores every bit as good as Rye but teacher salaries much lower and real estate taxes about 30-40% of what we pay in Rye ?
RTP,
Did you attend Rye Schools? If so, OH…MY…GOD!!! Did they teach you to write like that???Their = They’re. Look at your keyboard…it has punctuation marks. Run on sentence — YES!!!
If you did go (or are currently attending) Rye schools, then the teachers have failed you!!!
Ugh…
to Garnet Grad, every town in Conn. has much lower property taxes than all the towns in Westchester. Didn’t you do some research before deciding where to buy a home?
Anyone else notice all the police out giving parking tickets – even in the cold rain? They must be under orders to increase revenue through tickets.
Increasing revenue bu writing tickets. City management must be taking lessons from Mayor Bloomberg.
OMG: precisely the come back from overpaid Rye teachers i woud expect . Try and divert attention from the problem .
It was nice of you teachers to actually have your union try and squeeze Rye parents to respond to solicititations that we backed your pay increases ( i half expected threatening phone calls to respond or my kid would pay for my silence ) .
Just wait til Rye real estate actually declines just half of the plunge in California and other states . Suddenly , our sky high taxes will be a joke relative to what our houses are worth and the politicians will have no choice where they cut .
ah hoep u kin undirstand dat 2 🙂
Not only are you illiterate, but it appears that you are delusional also. Why would you assume I am a teacher? Because I commented on your very poorly written post? Believe me, it doesn’t take a teaching degree to see that your writing skills are lacking (although you did make progress on the subsequent post – congrats!).
Nope – not a teacher, just an observer.
Rye’s Police Commissioner came here from NYPD. This guy came here with the mindset of writing a lot more tickets and combatting Rye’s quality of life issues. After encouraging officers to write more tickets, he then proceeds to force the officers to illegally detain kids hanging out on Purchase Street.
Connors is obviously the wrong guy for Rye. He is as clueless and useless as I have ever seen hold this position. So why he is still here? Ask Otis.
I believe there is some good news regarding the cottages on Beck and Wainwright Aves. The corporation that owns the property has hired a well known architect and is filing for subdivision, and they are also planning to erect brand new luxury homes on the site. Recent publicity had come to the attention of various community groups and organizations who wanted to buy the property and create affordable housing in Rye, citing that Rye was one of the least affordable places to live and also one of the least ethnically diverse cities in all of Westchester County. Apparently the owners feel that from a business point of view, building new homes would be the most beneficial for the corporation’s bottom line.
keep proofreading OMG . its about all you overpaid town/county/state workers have left to do til the axe falls .