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Delaware County, PA November 3, 2009 Election
Smart Voter

Radnor Budget: Act Now to Prevent Major Tax Increase in 2010

By Elaine Paul Schaefer

Candidate for Township Commissioner; Township of Radnor; Ward 4

This information is provided by the candidate
We need to act responsibly and act now to balance our budget without raising taxes and without spending out of our savings.
Later this month, the Radnor Board of Commissioners will take on the challenging task of putting together the 2010 budget against a backdrop of continually disappointing revenues. The 2009 budget is on track to end the year with an estimated deficit of over $3 million, and absent any significant changes in expenditures and/or revenues, the 2010 budget will reflect an estimated deficit of approximately $2.7 million. To cover the shortfall in 2009, the Board has authorized spending down about half of our $6 million fund balance --our township savings account. It is imperative that we refrain from spending the rest of (or a majority of) this fund to make up for the anticipated 2010 shortfall. Instead, we need to make swift and dramatic changes in both spending and revenue to balance our budget and avoid a massive tax increase and unwise depletion of our fund balance.

Over the past six months, a long list of options for spending reductions and revenue enhancements have been put forward during budget discussions. Suggestions for spending reductions have included:

  • Reductions in staffing levels (15 employees have already been cut);
  • Elimination of rear-yard trash removal service - potential savings: $300 to $400 K, with an undetermined amount of revenue possible if some residents choose to continue the service for a fee of $350;
  • Bond refinancing - potential savings: $275,000 over life of the bonds;
  • Reduction in the street sweeping schedule;
  • Reduction in the frequency of mowing non-athletic fields;
  • Reduction of building cleaning services;
  • Reduction in professional development training;
  • Reduction in financial support of community non-profits;
  • Modification of snow removal service;
  • Modification of current level of police service;
  • Reductions in certain employee life insurance plans;
  • Institution of a temporary furlough program - either one day weekly (potential annual savings: $2 million) or one day per pay period (potential annual savings: $1 million).

Suggestions for new or increased revenue sources have included:
  • Increase in recreation fees for non-residents;
  • Creation of revenue from renting out unused office space in township building - potential income: up to $30,000 annually;
  • Increase in fees for field maintenance and field rental - potential income: $35,000;
  • Creation of revenue from advertising on fields and in the Parks & Recreation brochureˇXpotential income: $12,000 ;
  • Increase in rental fees at the Willows -- potential income: $12,000;
  • Increase in rental unit fees and ZHB application fees - potential income: $81,000 in rental fees and $12,000 in ZHB fees.

In my opinion, our Board should take this menu of options and implement ALL OF THE ABOVE. We have not received solid numbers for all of these measures, but my guess is that all of them put together will still not get us to $2.7 million and more will need to be done. Further measures that we might consider include:
  • Increase grant funding from both federal and state sources, taking advantage of currently available stimulus funding;
  • More aggressive use of LED lighting in all township facilities to decrease electricity costs;
  • Continued and more serious discussions with our many large and successful higher educational institutions -- who do not pay taxes -- about making or increasing PILOTS (payments in lieu of taxes);
  • Increase fees for building permits and inspections;
  • Increase fees and rents charged to cell tower/panel providers;
  • Look into a VOLUNTARY earned income tax -- which might allow residents who already pay EIT to another township to redirect that payment to benefit their own township;
  • Look to our local non-profits to share some of (or assume) the financial burden of maintaining some costly assets -- using the Willows Cottage as an example, where non-profits have taken that responsibility off of the Township's shoulders.

We were indeed fortunate to have a strong fund balance to cushion the blow in 2009 and allow us to avoid raising taxes. However, continued reliance on this fund is not a tenable long term solution. Further spending out of this fund will harm our financial position in the long run by jeopardizing our bond rating.

Further, we have a colossal financial burden looming ahead of us in unfunded, long term liabilities ˇV over $3 million of carryover liability stemming from past unused sick-time and comp-time policies, and approximately $45 million in future retirement benefit liability. These staggering debts are currently unaccounted for in our budget and treated with a "pay as you go" approach. This strategy is unacceptable. We should be allocating dedicated funding for these debts on an annual basis. But even if we do begin to try to fund these future liabilities, it is virtually certain that there will be years in which these payments will blindside us. This is the type of emergency that our fund balance was intended to protect us against and for which we need to maintain a healthy fund. It is simply inappropriate to use it to fund predictable and foreseeable operational budget deficits resulting from a reluctance to make tough but necessary cuts.

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pa/dl Created from information supplied by the candidate: September 27, 2009 16:19
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