The City does not plan new taxes next year | News, Sports, Jobs
City officials on Monday proposed a budget of $35.4 million for next year with no tax increases.
The budget includes a small operating surplus, despite inflation, according to City Manager Omar Strohm.
But the city is relying on some of its $39.6 million from last year’s American Rescue Plan Act to create the surplus “and it will end after this year,” Strohm said, noting that coming up with a spending plan for 2024 by this time next year could be more difficult.
ARPA money will cover most capital needs for 2024 and pay “workforce replenishment” — primarily in the community development department, where a former official made cuts to avoid a tax hike for 2021, according to Strohm.
Without ARPA money, “there would be an operational deficit” Strohm said. “Something to keep in mind.”
The city also faces “extreme responsibilities” with debt service, pensions and other retirement costs, Strohm said.
Conversely, the city has an unrestricted fund balance of $9 million, about 25% of its annual budget, well above the minimum of about 16% generally recommended for “general purpose governments” by the Government Finance Officers Association, according to civicfed.org.
The city will at some point develop a multi-year financial plan, but Monday’s meeting was not the place to speculate on how budgeting for 2024 will play out, Strohm said, when asked if the city might then reenter the annual cycle. of skimping that preceded Altoona’s 2012 entry into the state’s Law 47 Struggling Municipalities Plan.
For now, inflation “like I’ve never seen” put pressure on all aspects of operations, said Strohm, who spoke about “challenges” in the development of the 2023 expenditure plan.
It’s the same pressure that turns personal 401(k) plans into “201(k) Plans”, said Councilman Jesse Ickes, a financial adviser.
Regardless of the current and impending challenges, it is good for management to budget according to “reality,” said Councilman Dave Butterbaugh.
Before entering Act 47, that wasn’t happening, Butterbaugh said.
Fiscal pressures may tighten, but the city still needs to “operate at a certain level so that citizens have a quality of life”, according to Councilman Ron Beatty.
“There must be a standard of services” said Councilman Dave Ellis.
“That’s about what it costs” Beatty said, referring to the spending plan presented by Strohm.
With 230 budgeted employees, the staff is 30 or 40 fewer than when he started working for the city nearly 20 years ago, Strohm said.
“It’s amazing what is being done for the number of people we have,” said Ellis.
“More with less” said Councilman Bruce Kelley.
The looming financial pressure for next year and beyond shows how important it is for the city to maximize tax revenue from plots such as those staff have identified for the Redevelopment Authority and its Bank land are developing and putting back on the tax rolls, Beatty said.
The Council plans to introduce a budget ordinance on November 14 and adopt the ordinance on December 5.
The Mirror’s staff writer, William Kibler, is at 814-949-7038.