Proposed budget increases tax rate by 2.99 percent, decreases capital spending for next fiscal year
Concord’s municipal tax rate would jump 2.99 percent under City Manager Tom Aspell’s proposed budget for fiscal 2015, the sixth year in a row he has presented a balanced budget to the city council.
Though balanced, Aspell’s proposal cannot account for some questions, like how much to spend on the Main Street project or how to salvage Concord’s dwindling parking fund, that the council will consider in coming months.
The proposed budget for the fiscal year that begins July 1 contains $54.99 million in general fund spending – a 1.6 percent increase over the amount budgeted last year. Total spending, including special funds, would come to $88.68 million next year.
“The city of Concord has been successful in maintaining a stable budget while continuing to provide very high quality services,” Aspell wrote in a letter to the councilors.
Most of the estimated jump in the tax rate is due to a roughly $452,000 increase in debt service payments this year. That’s a ripple effect of Concord’s capital spending, as the city begins to make principal payments on its major projects.
“The investments that we’ve made particularly over the last few years, now we’re starting to make (those payments),” Aspell said.
For fiscal year 2014, city staff budgeted $34.24 million for capital projects that included: the reduction of Loudon Road to three lanes, the reconstruction of Route 3 through downtown Penacook and the replacement of the Sewalls Falls Bridge.
This proposed allotment of $13.45 million for 2015 is more modest, said Matt Walsh, deputy city manager for redevelopment, downtown services and special services.
“It’s significantly less than last year, but there were a couple projects that drove last year, like the Sewalls Falls Bridge,” Walsh said.
Capital projects for fiscal year 2015 include: the last phase of the Route 3 reconstruction; a city-wide community center on the Heights; renovations to the police and fire stations; and improvements to the city’s pools and Memorial Field.
That estimated 2.99 percent increase in the tax rate will also go toward four police department positions previously covered by grant money, as well as the city’s increasing utility bills. There would be no new staff positions, and while the the proposed budget excludes money for some vacant positions, no current employees would be cut.
What is – and isn’t – in the capital budget
This proposed 2015 budget includes about $651,000 for the final phase of design for a citywide community center on the Heights. The following year, however, would be the big-ticket year for that project if the council decides to build it. About $11.4 million, of which $1.1 million would come from donations, is earmarked for that construction project in 2016.
About $50,000 would be spent on roof repairs at the fire stations; $500,000 on renovations to the police station on Green Street. That station was built nearly 40 years ago, Walsh said.
“It’s the first major overhaul since probably ’77,” Walsh said.
Those renovations would upgrade the station’s doors and windows, along with some smaller items. While those fixes are planned for this year, Aspell said staff will also begin a review of the entire campus on Green Street to determine the best use of the city’s buildings.
“What are the needs of the community going forward?” Aspell asked. “I think there’s three big drivers there. The future of the library, they’ve essentially outgrown the space that they have. You have the police station, . . . they’ve outgrown their area, and then you have the Green Street Community Center, which really is not used to its highest and best use.”
Among other projects that would receive money in this capital budget are:
∎ $2.5 million for the final phase of the Route 3 reconstruction from Stark Street to Manor Road. Construction is scheduled for next summer.
∎ $1.3 million for chemical process improvements and upgrades at the city’s water plant.
∎ $1.14 million for paving projects, slightly more than last year. Most of those dollars will go toward final pavement coats for road projects already completed. Once the Route 3 and Loudon Road projects are finished next year, Aspell said the city would turn its attention back to repaving smaller local roads. “Once Loudon Road is done, it’s time to go back to the neighborhoods,” he said.
∎ $600,000 to fix drainage problems around Horseshoe Pond and the Kimball Jenkins School of Art. The city would only pay $140,000 of that project; the state’s share is $460,000.
∎ $260,000 for a new gym floor at the Green Street Community Center.
∎ $205,000 for improvements at Beaver Meadow Golf Course, including renovations of greens and drainage improvements.
Not included is the Main Street project, which would redesign and rebuild 12 blocks of downtown Concord. In the last budget, the city had planned to spend $9.64 million, which was supposed to break down to $4.28 million in federal grants, $1.57 million in private donations and $1.26 million in city bonds.
But since the city has rejected two bids for the project that came in nearly double its budget for construction, Concord has yet to hire a contractor. City staff is currently negotiating with one of two firms that submitted proposals for the work in the most recent attempt to hire a contractor, Aspell said. The city council will have final say on the scope and price of the downtown redesign.
Until then, Aspell can’t write the Main Street project into his budget because he doesn’t know exactly how much it will cost.
“Even if we thought we knew, until the council and the community says, ‘This is the project we want you to build and here’s the level we want you to operate it,’ you can’t put it in the budget yet,” Aspell said.
In its last budget, the city also planned to spend $2.05 million on a new riverfront park, Penacook branch library and other roadway improvements at the Allied Leather tannery site. But Weston Solutions, the developer who wanted to build an assisted-living facility on that site, withdrew, and Walsh said this year’s capital budget doesn’t include any money for that project.
“At this point, it’s going to be driven by when we get a developer to acquire the site, to partner with us to finish redevelopment there,” Walsh said.
Planning ahead for utility bills, parking losses
About 61 percent of the money raised in property taxes in 2015 would go toward police and fire operations, and 23 percent would go toward general services. Aspell did make some reductions in the budget this year, in part by not including money in the budget for vacant positions in the police and general services departments.
The estimated tax rate increase would also pay for a $132,000 increase in the city’s utility bills in 2015. Concord’s contracts for natural gas and electricity expire at the end of June and December, respectively.
City staff estimated the city’s expenses will increase more than 30 percent under new contracts.
“The past four of five years, there have been a lot of energy-improving projects that we’ve done,” Walsh said. “So that will help mitigate (costs) to a certain extent because we’ve reduced our consumption.”
The parking fund “continues to struggle,” Aspell said. In June, the city council will vote on whether to spend $115,000 on a strategic parking plan. That would be brought back to the council before fiscal year 2016, when the fund is expected to lose more than $300,000 if the city doesn’t make any changes to parking.
With the help of revenue from the Sears Block Tax Increment Finance District, Walsh anticipated the fund will hit a balance of almost zero in fiscal 2015. He anticipated the city would lose about $124,000 of its revenue through the year when construction begins on the Main Street project.
“We’re assuming we’re going to lose half of the meter revenue through the course of that project,” Walsh said.
The city’s water rate would increase 2.44 percent, and the sewer rate would increase 2.69 percent. The price of pay-as-you-throw bags would stay the same, in part because the city will save money with a new contract for trash collection and disposal.
The budget was delivered to city councilors Friday night, and Aspell will formally present the budget to them May 19 at 7 p.m. in council chambers. The council will hold a number of meetings before a final public hearing and vote on the budget June 5.
(Megan Doyle can be reached at 369-3321 or firstname.lastname@example.org or on Twitter @megan_e_doyle.)