Friday, November 24, 2006
City officials are working with the unions to help cut expenses.
By VIRGINIA ROSS
VINDICATOR CORRESPONDENT
NEW CASTLE, Pa. -- The proposed 2007 budget city council introduced reflects no tax increase. That could change over the next several weeks as lawmakers weed through the spending plan drafted by Mayor Wayne Alexander.
Officials have been looking for ways to cut expenses and increase revenue to keep the city from being declared financially distressed through the state's Municipalities Financial Recovery Act, known as Act 47.
"I said I would present a plan with no tax increase and that's what I did," Alexander said after council's public meeting Wednesday night. "I don't know that it will stay that way. We'll see what happens."
Alexander's proposed 13 million budget for 2007 calls for the millage rate to remain at 9.916. The 2006 budget, at 12.5 million, included a 1.5-mill property tax increase. One mill generates more than 400,000 a year.
In 2005, the mayor originally had recommended a 12.7 million budget for this year, but council decreased expenditures by shaving overtime and eliminating services such as the citywide spring cleanup. Even so, the city has a 1.5 million general fund deficit and a 1.3 million deficit for its minimum municipal obligation for its pension fund.
Lawmakers have said they will continue this year to explore ways to cut expenses. They are expected to adopt a 2007 budget by the end of this year.
Hearing scheduled
Meanwhile, a public hearing to determine whether the city is financially distressed has been scheduled for 7 p.m. Dec. 6 at the New Castle High School auditorium. The Pennsylvania Department of Community and Economic Development will conduct the hearing under Act 47. But city officials have said they intend to work together to develop and initiate a recovery plan before the hearing. They are hopeful their plan will be acceptable to the state so the city can avoid going into Act 47.
Council has asked several unions representing city employees to agree to a pay freeze next year. Earlier this month, lawmakers negotiated a seven-year contract with city firefighters that calls for those employees to take a pay freeze in 2007. The city's previous contract with International Association of Firefighters Local 160 wasn't due to end until 2008.
The city is also negotiating with the unions representing code enforcement and clerical workers and is also trying to work out revised police and public works contracts.