Derry councilors cut $235,000 from budget for tax reliefBy HUNTER MCGEE
Union Leader Correspondent
May 07. 2014 10:52PM
DERRY — Despite warnings from administrators of possible dire financial consequences, town councilors have agreed to cut $235,625 in salary and benefit increases from the proposed fiscal year 2015 budget.
Councilors voted 6-1 in their Tuesday night meeting to make the reduction in the salary and benefit increases that aren’t mandated by contract. Councilor Phyllis Katsakiores cast the lone dissenting vote.
In making the reduction from the approximately $37 million proposed budget, councilors said they were heeding the call of voters and residents who want tax relief.
“We need to listen to the residents of this community,” said Councilor David Fischer, who proposed the motion. “There are people on fixed incomes, people who are unemployed. And I’ve heard repeatedly at the microphone — again and again and again — the interest in reducing the tax rate.”
Councilors added that they appreciate the work of the town’s employees and the budget reduction wasn’t meant to target any particular workers. The reduction also wouldn’t mean the loss of any jobs or reduce any services, Fischer said.
But acting Administrator Larry Budreau and Frank Childs, chief financial officer, said before the vote that the cut could be devastating. They cautioned councilors to consider that the proposed budget is already extremely “lean.”
“I think this would be a travesty for the town of Derry,” Budreau said.
The town has made personnel cuts in recent years and administrators have worked diligently to keep costs down, they said.
Budreau said the outstanding contracts include five bargaining units and about 150 employees. Many of these workers haven’t received a raise since 2010 and the proposed increase in salary and benefits represents less than a 1 percent increase in the cost for the town, Budreau said.
“That is absolutely reasonable,” he said.
In addition, the town at some point in the coming months might incur another $112,000 in costs to hire a community development coordinator, he said.
“Then there’s virtually nothing left for just general cost increases — cost of fuel, cost of equipment or whatever,” Childs said.
Next year, the town could face a difficult situation to bring the budget within the town’s tax cap, with possible cuts in service to be considered, Childs said.
But Council Chairman Mark Osborne said he felt like he’d heard a similar discussion last year at budget time about possible gloomy financial scenarios if certain cuts were made. But things still seemed to work out well with the current budget, he added.
Childs said the past year has worked out because the town’s management team has done a good job of overseeing the budget and keeping costs down and cited an increase in revenue of approximately $650,000 from a rooms and meals tax. He added that he still needs to check to determine the exact amount of increase.