MANCHESTER, NH – As the city approaches the task of fine-tuning the mayor’s proposed budget, a special meeting is planned this week, March 22 at 7 p.m., to address budget concerns expressed by department heads, a majority of whom say they will not be able to meet budget demands under the current proposal (see compilation of responses below).
Departments currently on Wednesday’s agenda:
- Tax (Staffing)
- Welfare (Charter Transition)
- Fleet (Price Increases on Parts/Supplies)
- Health (Grant Funding)
- Highway (Radio Warranty)
- Fire (Overtime & Radio Warranty)
- Police (Complement Sustainability)
That meeting will be preceded by a joint committee on education to hear from school principals on the school district’s proposed $165,007,505 tax cap budget, which has been sent forward to the Board of Aldermen. The school board also voted to send a “rollover” budget of $167,500,000 to show what programs would be added back if Alderman increased funding to match the previous year’s budget, as well as a $170,080,065 budget, which the school board would commit to spending the additional funding on health and Spanish courses at the middle schools; reading programs; and for reducing elementary class sizes.
Bob Gagne, Chairman of the city’s Board of Assessors, explains how the proposed budget affects his office – the place where taxpayers go whenever they have gripes over their tax bills.
“In my office we’re budgeted for 10 positions, only nine of which have ever been filled, so even when they set this office up with ten, it was never fully staffed. The most we’ve ever had is nine employees. Right now we have seven people doing the work of nine people, which should ideally be done by ten,” says Gagne. And while it appears from the outside that we’re getting the work done, as I sit here I can see things that are not getting done that should be, and things we could be doing to make things better,” says Gagne.
It also means Gagne ends up doing a lot of clerical work on his department head’s salary, which is not the most efficient use of his time.
“I’m doing clerical work because someone has to do it,” says Gagne. “We have 3-4,000 property transfers each year, and it’s our responsibility to do that so that the right taxpayer is getting the bill. As the economy gets better that figure goes up. Meanwhile, one of the positions we have vacant is a clerk, who would be doing that, which leaves the rest of us doing the job at a labor rate above what it should be for that task.”
Like other departments within the city that have been making due with a budget that forces vacancies to go unfilled or hiring to be frozen, Gagne says all it takes is for someone to go on vacation, or get sick.
“I’ve got people in this office who can’t get their jobs done in a case like that, and that’s where it manifests itself, even if you don’t see it as a bottom line,” says Gagne. “But you have to ask yourself, at what point do the wheels come off and the thing collapses on itself?”
Especially in a city besieged by a heroin epidemic.
“I guess a cap is a good idea. But when the economy stinks and the Consumer Price Index is in the tank at the same time you have an opioid epidemic adding unanticipated costs for ambulance, fire and police services, or you may have increased demands on welfare, I don’t think it’s proper to tie a tax cap to something that doesn’t move at the same rate or direction as CPI, like demands on city services,” Gagne says.
By design, the sole provision in place to address the unmet needs of a tax cap budget is to override it, says Gagne.
In the bigger picture, Gagne says it’s hard for anyone to argue with the fact that the city could be running more efficiently – even realizing more revenue – if departments were fully staffed and funded.
“I’ve watched the board argue over the tax cap, and there is a small number of them who wouldn’t vote to override it even if the city was burning down; it’s against their political persuasion, whether they are conservatives, or free-staters, or libertarians who feel you can’t solve everything with government,” says Gagne.
When people come into his office to complain about how much their tax bill is he reminds them that taxes are collected because the citizens of the city demand certain services.
“And along with that, there are constitutional requirements and legal requirements that things be done a certain way. Our values have to be at market every so often. That’s the law. We’re not collecting those taxes to ‘feed the animals,’ or if we are, the animal is the 110,000 residents of the city, so they should probably look in the mirror,” Gagne says.
Historically, a tax cap doesn’t always accomplish what voters think it’s going to accomplish. While it may restrict the tax rate, it also can reduce city services to a point of critical mass.
“If you look at the history of tax rates and expenditures in the city – and I say this as a guy who was born and raised here in 1955, who’s owned a house here since 1983, and who’s been assessor since 1985 – the history of money the city raises and spends didn’t justify having to put a cap in place. There were plenty of years the rate stayed the same or went down,” Gagne says.
Years that are light on snow removal expenses are quickly erased by years of heavier snow demands. And years when the state downshifts retirement costs to municipalities are something totally outside the control of the Mayor and Aldermen. Legally you have to pay that fee after the state walks away, and the only provision to do so is overriding the tax cap, Gagne says.
New construction projects that generate new revenue also increase demand for services, whether it’s a 90-unit apartment complex, or 100 new homes.
The other issue he hears a lot about is related to the tax rate and valuation of property when it comes to the reputation of Manchester schools.
“We hear all the time people are fleeing the city because of the reputation of the schools, and how they won’t be able to sell their houses because of it. But the facts on the ground don’t hold up on that. Right now there’s no place in the city where if you list a house you can’t sell it. Sales prices are climbing – not necessarily because we’re more attractive than Bedford or Goffstown, but at a certain price point, there will always be someone willing to buy,” Gagne says.
Extending that argument further, if the school district were able to elevate its standing through programming and performance, who’s to say a home currently selling for $200,000 wouldn’t sell for $225,000 or $250,000 because of that, Gagne says.
For residents who might be willing to see their taxes go up in return for city services and schools run like a well-oiled machine, overriding the tax cap – or abolishing it by removing it from the charter through the voting process – is required.
“When the tax cap was proposed the supporters did a better job at making a case for it than those who were against it. People were compelled to sign a petition for the tax cap by someone saying it would prevent their taxes from going up more than a percent or two. But the average person doesn’t understand what that means to a city over five to 1o years. If you are concerned about services being cut and schools being insufficiently funded, you can be a champion of rewriting the tax cap or getting rid of it,” says Gagne. “I’m not saying I’m for that – but from where I sit, that’s what can be done.”
Below are highlights of the responses received from department heads last week by the city Clerk’s office as requested by Ward 3 Alderman Pat Long. The full responses are posted below:
- Parking department is proposing to increase revenue in 2018 by $1,114,000 by raising parking rates $5 for monthly spaces and 25 cents for metered parking, and increasing fees for citations and boots.
- Fire Department requested budget was reduced by $49,000, potentially resulting in layoffs and increased overtime to cover mandatory personnel requirements and rolling station closures.
- Central Fleet Management department head Kevin O’Malley reported that funding their own retirement would translate to being without a mechanic for half a year. He also noted that year over year they are over budget due to level or insufficient funding, resulting in equipment downtime and degradation.
- Health department reduction in funding could result in layoffs of community nurse positions and other outreach personnel positions that are currently grant-funded.
- Human Resources head reports that they would be underfunded for status quo services, with no raises for staff depending on whether departments have to pay for their own step and longevity raises. Staff is uniquely qualified to do certain tasks which aren’t easily replicated by others, should they have to step in to pick up the slack.
- Information Services says absorbing severance would be devastating to the department, resulting in at least one layoff and reduction of ability to provide services, including to the water department, which they are currently doing, to assist with modernizing projects.
- Carpenter Library: Under the proposed budget they would see a shortfall of more than $86,000 for merit, longevity and/or COLA increases for staff.
- Planning and Community Development: A $74,000 potential shortfall due to absorption of severance.
- Police would be fully funded and see a nearly $2.5 million increase over last year’s budget, but to absorb severance payout should they hit the average annual retirement of 10, they’d see a nearly $400,000 shortfall, which would mean a hiring freeze.
- Public Works has 48 employees eligible to retire, with half of those over age 60. On top of a budget shortfall of $125,000 due to reduction of budget for fuel oil and renewing warranty on radio system, they would not have sufficient funding to work within the proposed budget.
- City Solicitor’s office – Due to a calculation error when submitting their budget requirements, the department would be short by $65,000 to cover the cost of the city audit and would again have to leave a vacancy in the office unfilled.