Jim Bouley, Tom Aspell say Concord is financially strong
Development in Concord shows the local economy is slowly improving, City Manager Tom Aspell said in his state of the city address to the Greater Concord Chamber of Commerce yesterday.
Increases in motor vehicle registration, planning and permitting revenue are “signs that the economy is turning around a little bit, at least for Concord,” Aspell said during a luncheon at the Holiday Inn.
But, Aspell and Mayor Jim Bouley warned, rising retirement and health care costs will present the greatest challenge in the city’s next budget.
“Probably the biggest challenge we have . . . budget-wise next year is that there’s this little thing called downshifting of costs,” Bouley said. “If we have any state legislators (here), I’m sorry, but this is what happens.”
Two years ago, lawmakers ended the state’s contribution to pensions for police officers, firefighters and teachers. In addition, the trustees of the New Hampshire Retirement System raised employer contribution rates to handle unfunded liability.
The city faces an estimated $1.1 million increase in its retirement costs, and the Concord School District will have an estimated increase of more than $900,000.
Health care costs are increasing under the Affordable Care Act, Aspell said. Benefits requirements will increase, especially for part-time employees working more than 30 hours per week.
“Now we’re moving into a situation where they work 32 hours or 34 hours . . . either benefits are going to have to be provided or hours are going to have to be reduced,” Aspell said.
Bouley said the city council has met its goals to create balanced budgets, “be responsible in our fiscal management,” and expand the city’s tax base.
Aspell highlighted the city’s ability to pay its debt and balance its budget despite poor economic conditions. The city has top bond ratings and has had five straight years of balanced budgets.
Concord was ranked No. 1 last year for economic strength among 576 cities nationwide with less than 50,000 residents, according to an analysis by Policom Corp.
Growth in taxable property value had slowed for a few years but is now level, Aspell said. New growth is outside changes in existing property values.
Aspell said increases in car registration fees, which account for 49 percent of the city’s revenue, show that residents are spending more money on vehicles.
“So again, looks like we hit the bottom and we’re starting to climb out of this,” he said. “People are buying new cars – or better used cars – and registering in those dollars that translate back to the community.”
Building permits and planning applications have increased in the past two years. Aspell attributed about one-third of that revenue to the Concord School District’s construction of new elementary schools.
The housing market has not seen the same improvements, Aspell said. In 2012 the city had a net loss of housing units; 18 were knocked down and 15 were built.
“That’s the first time that’s ever happened – ever,” he said.
Between 1999 and 2003, city records show that Concord added between 250 and 300 homes each year, Aspell said. He said 2013 has already brought a net gain of one housing unit, and he estimated an increase of 20 or 30 homes by the end of the year.
Aspell and Bouley also outlined a number of projects and decisions that the city council will face in the coming months.
“Those decisions are really going to set the stage for what happens in Concord for really over the next 25 or 50 years,” Aspell said.
Among the projects listed yesterday:
∎ A redesign of 12 blocks of Main Street. The city council will finalize the design in May.
∎ The Penacook phase of the Route 3 reconstruction project; the city council will vote next month whether to increase the cost of the project by building a roundabout and burying utilities. The utility project would add one year to construction, which will begin this spring.
∎ Development of the former Allied Leather Tannery site in Penacook; the city is negotiating with Weston Solutions to build an assisted living facility and consider relocating the Penacook branch library.
∎ The selection of a developer for the state Employment Security headquarters on South Main Street. Aspell said the property has generated interest from developers, including some from other states.
∎ The replacement or rehabilitation of the Sewalls Falls bridge. The council will choose a final plan Monday.
∎ A proposed ordinance that would ban “aggressive panhandling” in Concord. The council will hold a hearing and vote Monday.