West Brandywine Township budget hearings will continue this week. There is no real estate tax increase or sewer fee increases, but there will be a $35.00 increase in the trash fee. The trash fee will rise from $225 to $260.According to Township Manager, Ron Rambo, the township has cut the proposed general fund budget 4% from $3,009,655 in 2008 to $2,889,915. Rambo has asked each of the departments for a "bare bones budget" for 2009. The board of supervisors has stated they began the budget process with the premise they would not raise taxes this year.
The township is having financial issues due to a required substantial increase in the police pension funding while simultaneously having a significant decrease in revenue. The state mandates municipalities fund any losses to the police pension fund due to losses in the market conditions. The police pension fund has defined benefits meaning the benefits are guaranteed. By the end of the year, the state requires a contribution to make up for any loss to that expected funding. Supervisor Carl Lindborg said, "No one could have predicted the change in the market over the past year."
In 2007, the township put $49,802 into the police pension fund. This year, the township will more than double its contribution of $102,249 going into the pension fund. In 2009, the police pension fund will need $32,574 more dollars to reach $134,574. In three years, the annual contribution has increased significantly.
Between 2008 and 2009, according to the budget, there will be $13,483 decrease real estate tax revenue in just one year. The real estate tax revenue will go from $459,329, to $445,838. Rambo believes this is due to residents asking for and the county granting appeals to housing value assessments. Those appeals have increased significantly over the past few years. This is not just happening in West Brandywine Township, but this year the county noted these appeals are affecting its budget too.
The township is also expecting to see significant decreases in the real estate transfer tax, building permit revenue, contractor's and plumber's license fees. According to the proposed budget, the township is expecting to see a $108,675 decrease in those revenue line items from last year. The Use and Occupancy permit fee revenue will be cut by more than 50% as it will decrease from $13,750 to $5,100 in just one year.
In order for the township to balance their budget with the significant decrease in anticipated revenue, the township will cut their budget. At this point, there will be no staff layoffs, but there will be significant changes to staffing.
The township administrative secretarial staff will cut their full-time hours to a 35-hour work week. The police secretary will reduce her hours by 50%. All secretarial personnel will receive their medical benefits, but will have their rate for paid time off hours reduced to reflect the actual hours worked.
According to Rambo, he will pay two members from the road department with the state liquid fuel funding. That money is usually used for road materials, but Rambo decided to use it this year for salaries. Road work projects will be reduced until the revenue situation improves. All non-uniform employees including management and staff will receive no pay raise. The township will also cut its contribution to the non-union pension fund from 7.5% to 5%. According to Rambo, that is not a savings to the township. That money will move from the non-pension fund to the police pension fund. It is that money that will aid to make up the difference in the state-mandated police pension funding.
Under contractual obligations, the police department members, at this point, will receive their 4% annual raise. The township, the union, and their attorneys had met, but the township was still waiting to hear from the union. At the early December board of supervisor's meeting, the police union representative, Dave Domblesky, stated the situation did not come to light for them and their attorney until late November. Their attorney was currently studying the budget.
Supervisor Tom McCaffrey said he was disappointed in not hearing from the union sooner and stated the budget has to be enacted by the end of the year. Supervisor Joe Obernier reiterated they had heard nothing from the union. He also requested if there were concessions the union and it members were willing to make and were in agreement with, it should be brought forth quickly. Obernier had also stated the budget would probably need to be amended in December and possibly after it was voted on early next year.
If additional cuts are needed, it is likely to come from the police budget. The Police Department is the largest slice of the budget. It is 1/3 of the overall budget. However, if the state's pass-through money is taken out of the budget, the police department becomes 41% of the town-ship's discretionary spending budget. On a pie chart for the township budget, it is one of the largest slices of the pie. It is logically one of the first places to look for additional cuts.
Taking out that same pass-through funding, the administration/board of supervisors is 18% of the discretionary spending. The Road Department is 12% of the same spending. The Code Department is 7% of the township discretionary spending. The township's debt service is 16% of the budget without the state's pass-through funding.
The township will continue budget discussions at this week's board of supervisors meeting. Work will continue on the budget until the board of supervisors votes on the budget. They will vote on the budget at the December 29th at a special meeting.