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Monday, May 15, 2006

An update to 'Lookout Burlington...'

Just back in from being kicked out of the Council meeting for their usual executive session. They seem to have one at every meeting, so much that it's a rare thing to see a meeting go by without one.

Anyway, a slight update to the last post about the impending taxes...
Straight from Leopold's office, the city has a current estimated $40 millon debt in the Fiscal Year 07 budget. (Note - the draft of the 07 budget will be available by the end of this week). Based on the current estimates (which do not include the Retirement portion), Leopold estimates it would take a 2.4% tax rate increase just to cover the shortfall, and this is with the city taking about 1/2 of the Local Option Sales Tax (or LOST, as I call it) revenue to be applied to the 07 budget.
(On a side note, Leopold's changed the date of when LOST will take effect to July 1st, instead of January 1st for more money in the budget)

A few good comments & questions where brought up by some councilors after the presentation:
  • Councilor Bushor (Ward 1): I do understand that this estimate doesn't include the retirement portion, but what does the 2.4% increase mean to the average homeowner? Hopes it is addressed in the draft budget.
  • Councilor Shannon (Ward 5): I cannot understand how the uncollected taxes portion of the budget got to over $1.3 Million...
    • Leopold: They are outstanding or delinquent property taxes, which make up 4-5% of the total property tax portion of the city budget (the amount also includes interest, and late fees); the amount also includes gross receipts taxes, which the decision by the Liscense Committee made a deal with the late applicants that they would grant the liscense renewal, but only if they committed to a payment plan, otherwise no liscense would be granted. This guarantees the money from the gross receipts tax.
So this is all I have on the budget so far, aside from a few handouts comparing the tax rates, and deficits from previous years. John Briggs of the Free Press was also in attendance, so there probably will also be coverage there too.

8 comments:

Anonymous said...

From the Free Press...

"In addition to the 2.4 percent hike, a tax increase will be required to make up underfunding during the past two years of the city's retirement fund."
"(the contingency fund balance) will be dangerously low after its reserve is used to pay current deficits. It must be restored quickly, he said, or the city's credit rating will fall, raising the cost of borrowing money and compounding the city's shaky finances."

Thanks Progressives!

Heavenly said...

Yup, Briggs got his article in as well, here's the link:

'Austere' city budget forecast for next year

Anonymous said...

Kevin and Hinda would have had to do the same thing, unless they just felt like cutting services. The Progressives are responsible for the frigging stock market now? You remind me of the guy I saw on Center Street in Rutland last week. He kept screaming, over and over: "Blame it on Carter, Blame it on Carter....."

Anonymous said...

"The Progressives are responsible for the frigging stock market now?"

They're responsible for the fact that the pension was so dependent on the stock market during the dotcom bubble. The bursting of that bubble didn't decimate most pension funds. Ever wonder why the man responsible disappeared as soon as Clavelle announced that he was quitting?

john adams said...

Part of the problem is that pension commitments were irresponsibly jacked up based on the Progs' belief that their bet on drkoop.com was going to lead to untold riches. Have those commitments been rolled back, at least for new employees? If not, WHY THE HELL NOT?

charity said...

"Kevin and Hinda would have had to do the same thing, unless they just felt like cutting services."

Kevin would have most likely gotten rid of most, if not all, of the current city employees (department heads and such) and brought in new people because he would want a new way of doing things (although I cannot speak for him, but I do have to on pretty good authority that this is what he would have done). This would have saved a lot of money because new people would have been paid less than the people who have been there for a long time. Kiss just picked up with most of Clavelle's people. SSDD.

There would have been a tangible change in the way things were done, if he had gotten elected. It is a complete cop-out to say that there was no other solution other than what Kiss is doing.

GiveTexasBack said...

"The bursting of that bubble didn't decimate most pension funds."

You're kidding, right? Let's see, how many pension funds are now under government control thanks to entities with an overreliance on the stock market? Answer: Plenty. In fact, Congress is currently trying to tackle pension reform on the floor. Why? Because most companies wash their hands of them despite promises to lifelong workers. At least Burlington is trying to meet its obligations.

"Kevin would have most likely gotten rid of most, if not all, of the current city employees (department heads and such.... This would have saved a lot of money."

Thanks for that wonderful display of accounting incompetence. Who are you and Keving planning to bring in as department heads, outsourced workers from India? Only then would there be significant savings (in exchange for depleted city services, of course. But at least we could say we're freee of socialism).

Anonymous said...

"Let's see, how many pension funds are now under government control thanks to entities with an overreliance on the stock market?"

Municipal pensions and corporate pensions are not quite the same thing, Mr. Keynes.