City Budget Includes No Tax Levy Increase

Property taxes in the city of Jamestown will not increase in 2019 because it’s literally impossible.

On Tuesday, Sam Teresi, Jamestown mayor, released the 2019 executive budget, which included no tax levy increase because the city has once again hit its constitutional tax limit. The constitutional tax limit is the amount of money a city can ask its property taxpayers to provide compared to the total assessed property value in the community. City officials first hit the limit in 2017.

Because city officials have hit the limit, the tax levy next year will be same it was this year — $16,011,982. Because of a $3,715,617, or .56 percent, increase in taxable assessed property, the tentative budget includes a 13 cent, or .54 percent, decrease in the tax rate to $23.85 per $1,000 assessed property value.

Unlike the last two years when deficits have been built into the fiscal plan with the possibility of additional state aid to balance the budget, the 2019 executive budget does not start in the red. Teresi said through ongoing conversations with state officials he has factored the $1 million from the state into the proposed budget. The 2017 and 2018 executive budgets had deficits of $878,736, which the Jamestown City Council lowered to $824,926, and 946,679, respectively. Both years, the city received an additional $1 million in state aid once state officials approved their own fiscal plan, which has a deadline of April 1.

Teresi said he believes state officials have helped city officials with the budget the past two years because of the quality work they have done to cut cost through long-term initiatives to control spending through consolidation and efficiency. Another reason is state officials would rather not have Jamestown go bankrupt to the point it has to establish a control board to manage the day-to-day operations of the city government. The third reason is that in 2010-11, state officials decreased aid to the city by around $457,515, or 9.1 percent. The mayor said to date, that cut has decreased state aid to the city government by $4,481,838.

Teresi said the cut to all cities in the 2010-11 state budget was 2 percent, but it was larger for Jamestown because state officials factored in the Jamestown Board of Public Utilities. This was a unfortunate and unique situation for Jamestown officials because very few municipalities have a utility company like the BPU.

The mayor said — for those who will criticize him for accounting for the $1 million in additional state aid in his 2019 executive budget before the state passes its 2019-20 — nothing in the budget is assured. He said all budgets are based on estimates, experience and financial forecasting.

“Nothing in the budget is a sure thing,” he said.

Teresi said even though city officials have $1,849,000 in unassigned fund balance, he has used none of the savings and warned the council to do the same. Joseph Bellitto, city comptroller, said it is suggested by financial experts that the city should have a fund balance of around $6 million based on the city’s $36 million budget.

“We’re still not back at a healthy balance,” Teresi said about the unassigned fund balance.

The proposed budget also includes no increase or cut in funding to the James Prendergast Library. Teresi has proposed keeping the library’s funding at $50,000. Last month, library officials had requested city officials to restore their funding to the $100,000 they received in 2017. In 2016, city officials cut the library’s funding from $350,000 to $100,000, which was a 71 percent decrease.

For the third year, the executive budget includes no revenue sharing payments from the BPU’s electric and water divisions. Between 2013 to 2016, a total of $1,859,000 was given in electric and/or water revenues toward the city’s fiscal plan, which the BPU board also approved. The 2016 city budget included $433,481 from the electric division and $48,519 from the water division; in 2015 $482,000 was included in the city budget from the electric division; in 2014 $475,000 was in the city’s budget from the electric division; and in 2013 $300,000 was included from electric and $120,000 from water.

Teresi said taking revenues from the BPU wouldn’t be a wise financial decision because the profits aren’t available like they were in past years.

Marie Carrubba, council president, said the 2019 executive budget is a good starting point for the council, who will now deliberate over the budget. The council will start its budget meetings at 6:30 p.m. Monday on the fourth floor of the city Municipal Building, located at 200 E. Third St., when it meets with officials from the Public Works and Parks departments. The council has until Dec. 1 to pass a 2019 budget.

For more information, visit jamestownny.net, to view the executive budget memo.

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