Proposed budget raises taxes 3.1 percent, doubles bonds for projects
From left, City Manager Tom Aspell and Mayor Jim Bouley take questions from the audience after presenting Concord's State of the City address during a breakfast forum at the Grappone Conference Center in Concord on Feb. 24, 2011. (Katie Barnes/ Monitor Staff)
City Manager Tom Aspell’s budget proposal includes a 3.1 percent tax increase and an ambitious capital improvement plan that doubles this year’s capital spending.
The estimated change in the tax rate is due largely to a $960,000 increase in retirement costs, Aspell said yesterday. He also attributed the increase to police officer positions previously covered by federal grants.
“So essentially, if we didn’t have those two numbers that we were dealing with, you’d actually have a tax rate that would go down,” Aspell said.
The city’s budget is balanced for the fifth year in a row and maintains city services. Aspell proposes $53.45 million in general fund spending – a 1.5 percent increase over the amount budgeted last year – and $92.91 million in total spending.
With several large projects on the horizon, Aspell describes his 2014 capital improvement plan as “the most robust in recent memory.”
Federal grants would cover $15.2 million of the proposed $34.24 million capital budget.
Projects for fiscal year 2014 include: the Main Street renovation project; the reduction of Loudon Road to three lanes; the reconstruction of Route 3 through downtown Penacook; the replacement of the Sewalls Falls Bridge; and redevelopment of the former Penacook tannery site.
“As you hear about each of these projects, I think there’s community consensus to do every one of these things,” Aspell said.
The budget also includes some reductions, including staff changes that amount to a net loss of 1.05 employees. One vacant firefighter position would be eliminated, and part-time positions in the human services department would be replaced with a full-time position for a small net reduction in staff. Slight staffing increases would also be made through changes to part-time positions for police dispatchers, the legal department and the parks and recreation department.
The police department’s budget has a $165,000 reduction to eight positions that are currently vacant. But that doesn’t mean the department can’t hire new officers, Aspell said; the budget simply assumes some of the positions will remain unfilled.
Maintaining police positions that had been covered by federal grants will cost the city an additional $169,000 next year.
Retirement costs account for about 2.9 percent of the estimated 3.1 percent tax increase, Aspell said. The New Hampshire Retirement System raised its employer contribution rates beginning July 1, and two years ago the state ended its contributions for local employees.
Aspell said he anticipates “virtually no growth in terms of tax base” in the next fiscal year, which begins July 1. The estimated 0.05 percent growth is the lowest projection in several years, he said.
But Concord has good news in its insurance rates, said Deputy City Manager for Finance Brian LeBrun: There was no increase to the city’s health insurance, disability, or life insurance rates this year.
The next fiscal year will bring changes to downtown Concord and downtown Penacook.
The budget has $9.64 million to redesign Main Street. That amount includes $4.28 million in federal grants, $1.57 million in private donations and $1.26 million in city bonds, said Matt Walsh, the city’s assistant for special projects.
The Main Street project cost has increased from a previously projected $7.85 million – it now has an additional $2.5 million for underground utilities on South Main Street. Walsh said funds for utilities would be bonded and paid through the Sears Block Tax Increment Finance District.
The budget includes $2.2 million in bonds for reconstruction and streetscape improvements on Route 3 in Penacook. That amount is in addition to $1.74 million approved by the city council in March to move utilities underground.
Redevelopment of the former Allied Leather Tannery site in Penacook is also budgeted for 2014. The city would spend $2.05 million on a riverfront park, Penacook branch library and other roadway improvements, if a partnership moves forward for Weston Solutions to build an assisted-living facility to the site. The city’s spending would be financed by the Penacook Village Tax Increment Finance District and private donations, Walsh said.
To facilitate projects on Main Street and in downtown Penacook, Aspell has proposed a personnel change in the city’s administration. He would eliminate the assistant for special projects position currently held by Walsh, and replace it with a new job: Director of redevelopment, downtown services and special projects. Responsibilities would remain similar to Walsh’s current job, but with an added focus on economic development in downtown Concord and downtown Penacook.
“I thought it was time that we actually had someone that actually focuses almost solely on the downtowns,” Aspell said.
Aspell said the new position would also oversee policy and funding for parking, and the city’s parking committee. The city’s parking manager, part of the police department, is now responsible for those duties. Aspell proposes replacing the parking manager position with a parking supervisor, responsible only for day-to-day parking operations.
Aspell has recommended that the city council review parking this year, as it did with a special parking committee that recommended kiosks and rate increases in 2010. The parking fund is projected to lose more than $213,000 in the current fiscal year, according to the budget.
“The parking fund, as usual, is challenged,” Aspell said. “So I’m asking that we undertake a review of the parking system and make recommendations.”
Loudon Road could also get a makeover in fiscal year 2014. The budget includes $1.57 million to reduce the four-lane road to three lanes from Airport Road to D’Amante Drive. Walsh said 90 percent of the project would be federally funded and hinges on a successful grant application.
Also on the Heights, Aspell proposes spending $130,000 to begin designing a new community center at the former Dame School. The city now owns the old elementary school and reopened it in March as the Heights Community Center. The 10-year capital budget includes $10.78 million in 2016 for construction of a new community center on the site.
Aspell said the fund for Beaver Meadow Golf Course, which lost money in recent years, is expected to break even or earn money this year. He budgeted $135,000 for upgrades at the course, including a golf simulator, automatic ball dispenser and cosmetic improvements.
The capital budget also includes:
∎ $10 million to replace the Sewalls Falls Bridge across the Merrimack River. (Federal grants would cover $8 million of that sum.)
∎ $1.1 million to repave Loudon, Mountain and Sugar Ball roads.
∎ $900,000 to purchase property for the future extension of Storrs Street.
∎ $535,000 for a new fire engine.
∎ $400,000 for improvements to the Memorial Field parking lot, concession stand and press box.
Other projects are still years away. Funding to build a new downtown library, for example, remains in fiscal year 2022.
Walsh said the city will bond twice as much money as it usually does to cover capital improvements this year. But a AA1 bond rating from Moody’s Investors Service allows the city to borrow money at low interest rates, LeBrun said.
Aspell said it’s a good time for the city to make investments in large projects, though he noted that taxpayers will pay off bonds for many years.
“We want to make sure everybody understands it’s not just this year, it’s future years and for many, many years to come paying for all of these things,” he said.
The city’s tax increment finance districts are also doing well, Aspell said. He proposes taking money from each of the three districts’ funds for the first time in the coming year to reimburse the city for administrative costs. Funds from the Sears Block TIF, for example, will go to the general fund and parking fund as reimbursement for construction of the Capital Commons parking garage.
Water and sewer rates would both increase by 2.5 percent under the proposed budget, and the price of pay-as-you-throw trash bags will not change.
But Aspell said the city must review the pay-as-you-throw trash system. The solid waste fund is projected to lose more than $263,000 this fiscal year, according to the budget, with an estimated loss of $347,000 in fiscal year 2014. Ideally, Aspell said, the cost of the bags should cover the city’s cost to dispose of the trash.
The proposed budget was delivered to city councilors last night. Aspell will formally present the budget May 20 at 7 p.m. in the city council’s chambers. The council will hold a number of meetings
before adopting the budget June 20.