MANCHESTER — Mayor Ted Gatsas presented a $297 million spending plan for the 2015 fiscal year on Monday, while asking the aldermen to work with him in the coming weeks to address a $6 million portion of the budget that was left unfunded.
Gatsas said in a speech before the Board of Mayor and Aldermen that meeting the city's needs while staying within the tax cap was particularly challenging for the 2015 budget, which would go into effect July 1.
"I must tell you that despite having a modest surplus, maintaining the hiring freeze and not authorizing department heads to fill funded vacancies, significant challenges for the Queen City remain in this budget," Gatsas said. "It is my hope that as a board we will choose to forgo the typical political paralysis that plagues the budget process and instead leave here this evening recognizing our challenges, having a common understanding of where we are at and work together to find sustainable solutions."
The budget is approximately $4 million larger than last year's, or 2.13 percent, the maximum increase allowable under the tax cap. The proposed budget for the school district is $159.5 million, which is $2.8 million larger than last year's. The total city allocation is $137.4 million.
As proposed, the budget will result in a 2.13 percent increase in property taxes. In other words, property taxes would increase by 48 cents to $23.15 per $1,000 of assessed value.
The budget for the school district is $500,000 less than what was proposed last month by Superintendent Debra Livingston. Gatsas said the reduction was coordinated with the superintendent.
The $6 million unfunded portion of the budget comes from an additional $3 million in city health insurance costs projected for next year and $3 million in projected contingency and severance costs. Health insurance costs are over-budget this year by $1.2 million, despite union contract concessions that were expected to save more money
The city is on track to have a $472,000 budget surplus this year, considerably less than last year's surplus.
"My fellow colleagues, I wish that I could stand here and tell you that there will be significant additional surplus and new savings so that we will be able to close this gap and fix the problem on the city side, but I cannot," Gatsas said.He said the budget proposes no layoffs for the city, and calls for increasing the police complement to 227 officers.
At the same time, the budget proposes a Fire Department complement of 42 firefighters, a reduction of four positions.
The aldermen will spend the next couple months reviewing the budget, as well as a slate of new revenue proposals, such as a pay-as-you-throw charge for trash bags. A hearing on the program is scheduled for Thursday at 6 p.m. at the Memorial High School auditorium.
After the speech Monday, Ward 1 Alderman Joyce Craig, who has played a lead role among the aldermen in crafting the final budget, called Gatsas' budget "concerning," singling out the $6 million in unfunded health insurance, severance and contingency costs.Craig said the budget underscored the need to explore new revenue options. But, she added, "Whether we go ahead with them is another question."
Gatsas' budget also proposes $3.7 million in new bonds. The money would go toward a computer-aided dispatch system for fire and police ($1.3 million); information technology upgrades ($650,000); and $1.2 million for road repairs. The budget also proposes a $935,000 bond for improvements and repairs at City Hall.
"Since this building was rehabbed under the Wieczorek administration, it has only seen cosmetic fixes," Gatsas said.
The aldermen, under the charter, were not permitted to debate the mayor's budget following his speech Monday. The budget must be finalized by early June
A public budget hearing has been scheduled for Tuesday, April 8, 6 p.m., at City Hall.
The budget can be viewed at the city website, manchesternh.gov.