Amid personnel upheaval and labor contract negotiations, Cheltenham Township officials are scurrying to put together their 2013 final budget, which will be going to the board this Wednesday night for approval. Some good news, however, did surface at this week?s Finance Committee meeting: the fiscal outlook for 2013 has improved enough that the probable property tax increase of 6.5 percent announced earlier has been scuttled.
When the Preliminary Budget was introduced three weeks ago, there was still a gap between revenues and expenses of almost $2.4 million. Board President Art Haywood said in his annual budget message more than a week before that the outlook included both a sewer fee increase and a boost in property taxes. The latest numbers, however, from Acting Township Manager Bryan Havir indicate that a combination of budgetary refinements, primarily changes in projections in the township?s favor on both sides of the ledger, as well as some relatively minor fee increases and some personnel cuts have significantly closed the gap. The board came out of the committee meeting Wednesday night still eying a shortfall of $676,000, not including the sewer fee hike and other adjustments that could eventually make the numbers add up.
The primary drivers of higher costs in this year?s budget are pensions ? up by almost $1 milion ? and heath insurance ? up $300,00.
Complicating the process and apparently adding some drama to this, Havir?s first opportunity to shepherd his own budget after 11 years as Assistant Township Manager, have been two untimely personnel changes, the latest being this week?s abrupt termination of Fiscal Affairs Director Joe Galdo.
The board took formal action on the change in executive session Wednesday night and approved Havir?s recommendation to appoint Bruce Rangnow, a supervisor in the department for some 20 years, on an interim basis. The township has been tight lipped about the move ? other than to say that it was due to performance issues ? at a rather awkward moment while figures are still flying just a week before the budget is to be finalized. Galdo had been in the position for less than two years.
The other personnel change was the previously reported loss of the township?s engineer, Pat Duffy, who headed up the Department of Buildings, Zoning and Inspections. Duffy left after less than a year for a job in Middleton Township (Bucks County) and has been replaced by an engineer and a planner provided through the firm Boucher & James. Duffy, despite his departure, is helping out in making complex sewer rate calculations, said Havir, as the budget goes down to the wire.
Another significant part of the budget context is the possible culmination of months of negotiations with the labor bargaining unit of the police department. A contract agreement could be announced at this Wednesday?s board of commissioners meeting, where a formal public hearing on the budget is also scheduled.
The big change on the spending side that helped bring down the deficit is a reduction of $840,000 in payments to Philadelphia for sewage treatment services, based on a combination of a rate drop and decreased flow volumes. The new figure indicates no increase in sewage treatment costs over last year. The other new major expenditure reduction category is personnel costs, where $643,000 is being cut through a number of departments. Five layoffs are in the police department, including two support staff, one community service officer and two cadets, now in training. Slots not being filled include that of a mechanic and laborer in Public Works, one in Parks and Recreation and one in Buildings. A part-time inspector position also was not filled in the Fire Marshall?s office.
New revenue increases include an additional $75,000 yield on the one percent earned income tax, based on the economy picking up, and $50,000 more in real estate taxes stemming from fewer court mandated assessment reductions. An additional $24,000 in revenue is projected from increases in pool fees, with family memberships now up to $225 annually.
Havir is pleased that the budget will allow bringing on four part-time students this summer to do grass cutting and weeding in parks, a function that could use strengthening, he admits. More generally, Public Works, says Havir, is at ?bare bones.? ?What we have now is having effects on the way we maintain public property. That?s why bringing back summer students to help offset what the permanent work force can?t get to is so important.?
To balance the budget, Ward One Commissioner Drew Sharkey?s idea to reshape the state funded Liquid Fuels program is getting serious consideration. If legal requirements are met, substituting electricity and utility costs for street maintenance and repaving projects while moving the street work to the capital budget could reduce operating costs by $200,000. It would likely stretch out the schedule for the repaving work, said Havir. That would put the deficit in the neighborhood of $475,000, which would have to be addressed by sewer rate hikes and whatever other savings and revenue adjustments are possible. Sewer rates tend to be considered a more efficient revenue producer by township officials than property taxes since sewer fees are paid by all property owners, including those exempt from taxes.
With this year?s scramble to get revenues and expenditures to match up, the libraries? $45,000 increase in the township?s contribution set out in the Preliminary Budget appears to be scrapped. Ward Six Commissioner Mickey Simon suggested instead at the Wednesday meeting a one percent increase in the township?s $1.5 million allocation, which would boost the amount by about $15,000. The board agreed to have staff explore the idea further, but support seemed lukewarm at best.
Look for Havir to accept the board?s offer, the specfics of which have not been disclosed, to take over as permanent township manager at the Dec. 19 meeting.
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