LAWRENCE: Council zones in on 1-cent tax hike

By Lea Kahn, Staff Writer
   Municipal Manager Richard Krawczun was given his marching orders Tuesday night — revise the proposed $40.8 million municipal budget for 2009 to reduce the tax rate increase from 3 cents to 1 cent.
   After a lengthy discussion, Township Council asked Mr. Krawczun to review the budget and reduce the proposed 3-cent tax rate increase to 1 penny. The tax rate would increase from 71 cents per $100 of assessed value to 72 cents.
   The move would avert the proposed layoffs of three full-time employees and one part-time employee. But it would not restore three part-time positions that already have been eliminated, or the summer helpers in the Public Works Department. A police officer vacancy would not be filled.
   Mr. Krawczun expects to present the proposed 2009 spending plan to Township Council for introduction at its April 22 meeting. Final approval would occur at the council’s June 4 meeting.
   To reduce the tax rate increase from 3 cents to 1 cent, Mr. Krawczun would have to find a mix of savings and/or revenue increases of $536,000. One penny on the tax rate is worth $268,000.
   The manager said the sale of the newly minted liquor store license — at a minimum bid of $300,000 — would help generate more revenue, but only if the license could be sold before final approval of the budget.
   Mr. Krawczun also anticipated raising an additional $50,000 or $60,000 in revenue by raising fees in the Construction Department. The fees have not been increased since 1994, he said. Miscellaneous fees charged by the township also could be increased, he said, but he has not yet identified those fees.
   Some savings could be realized by postponing the filling of a police officer vacancy until later in the year, the manager said. There are two openings in the Police Department as the result of retirements, but one of those two positions has been eliminated.
   Reductions in spending in various departmental operating budgets would help, he said. More savings could be generated by a proposal to provide emergency medical services fully in-house instead of providing municipal coverage daytime and hiring Capital Health Services for night and weekend coverage.
   Mr. Krawczun cautioned Township Council that some of the revenue sources that would be used in 2009 would not be available next year, such as the sale of the liquor license.
   ”Basically, we have put ourselves (in a situation) where we are spending our future money. The danger is that we could start out in the hole in the subsequent year,” Mr. Krawczun said, adding that the township could face a budget shortfall of at least $750,000 in the 2010 municipal budget.
   Councilman Bob Bostock said he agreed that relying on one-shot revenue sources is a bad idea, “but I think this year, people are in a very difficult, uncertain time. Things are tight for people and they are uncertain about the future.”
   Councilman Michael Powers said he is aware of the “boomerang” effect in 2010, but the 1-cent tax rate increase would help the residents now. He compared the tax rate decrease to a “grass roots economic stimulus.”