Taxes and Fees
Lancaster budget public hearing
By Lee Chowaniec
Nov 6, 2008, 20:45

The first media report on the Lancaster 2009 budget stated there would be no tax increase related to the General Fund and that the Villages of Lancaster and Depew would see a slight decrease in their tax rates. What was not mentioned is that Lancaster town residents would be seeing a tax increase of 3.42%.

Supervisor Robert Giza declared several times that it was a “status quo” budget. It may be considered a “status quo” budget in that services were not cut, no full time jobs were cut, employees in all departments received a 3% wage increase and as of now no changes have been made to further reduce employee health insurance costs.

The town did go to a single health insurance provider for all departments but the police in May of 2005. The police followed in January 2006 and retirees were placed into Senior Blue later in the year; estimated savings, $200,000.

This past May, the town moved to a self insured health care plan that also has catastrophic health cost coverage.

Spending

A status quo budget cannot be had when spending outpaces revenues generated. Despite the realized savings in health insurance, surpluses in mortgage and sales tax receipts, increased taxable property valuations and use of town reserves, town spending outpaced the aforementioned.

The tentative $27,710,938 budget increases overall spending by $1.26 million, or 4.8%.

General Fund – Town Outside of Villages spending increases by 4.4% ($855,977 to $893,369).

Police Fund increases spending by 4.8% ($7.76 million to $8.15 million).

Highway Fund increases spending by 10.6% ($3.39 million to $3.8 million).

The Special Districts portion of the budget increases spending by 6.2% ($6.37 million to $6.76 million).

All this spending takes place while the town boasts that there will be no cut in services and that no full time positions were added to the 2009 budget.

Several residents who regularly attend town board meetings asked questions on the budget. Their intent was twofold, to get information on spending reasons and to enlighten them on specificity on some line items.

Longevity Pay

All full time town employees receive longevity pay. The stipend is granted to recognize length of service and varies in value according to department. It is not included in wages as it would then go toward retirement benefit consideration.

White Collar Union (Salaried)

After 5 years service – 5 x $100 = $500

6 through 20 years - $500 + $50 added each year thereafter

21 through 30 years - $1,250 + $60 added each year thereafter

Blue Collar Union

After 5 years service - $800 thereafter

After 10 years service - $850 thereafter

After 20 years service - $1,150 thereafter

After 25 years service - $1,350 thereafter

Police Union

After 5 years service - $1,150

After 10 years service – $1,250

After 15 years service - $1,350

After 20 years service - $1,450

After 25 years service - $1,550

Other perks

No town employee, including elected officials, pays into the health/dental/eye insurance program. The town tries to low health care costs by increasing the size of the co-pays.

Besides shift differential and overtime pay, police get a $1,000 annual stipend in lieu of overtime should there be a call placed to the patrol car officer and he answers it while either driving the other officer to or from his home or the police station (Equalization Pay).

Police and blue collar employees receive a clothing allowance.

These perks were negotiated throughout the years and we are being told givebacks are near impossible.

Since 1997, town employees are not eligible for lifetime health insurance. The same is true for the police since 2000.

Town employees pay 3% of their salary into the NYS Retirement fund for the first ten years, police pay nothing into the system.

On average, the town pays 8% for Tier 3 & 4 town employees and somewhere around 16% for the police. This year’s New York State budget crisis will have no bearing on the estimated cost to the town for system payment.

Law

In 2008 the town budgeted $66,510 for a full time attorney. The Town eliminated its full time Town Attorney position, put the Deputy Town Attorney in as a part time employee to handle daily matters and paid $40,000 for his services. All outside legal work was outsourced to Hoskins/Russ who bill at $226 per hour (now $233 per hour).

The town proposes spending $50,000 for this legal position in 2009. We don’t see this as a 24.82 decrease in spending, as stated in the budget document, rather a $10,000 increase in salary and a spending gain of 25%.

We have been led to believe that the elimination changes that have taken place in the legal department will help offset the money being spent on outside counsel, especially in a year where the four union contracts have not been settled and the billing will be more than normal.

We are being led to believe the quality of service has improved in that we now have a law office representing us with multiple lawyers practicing in myriad law issues.

It is impossible to determine the costs of outside legal services by examining the budget, as such costs are distributed under Professional Services” in multiple lines in all department budgets.

However, we believe it most important to have legal counsel at Zoning Board of Appeal meetings. Yet at the meetings some of us attended there was no legal counsel present. We also believe in-house legal administering has regressed.

Health Insurance Buyouts

It is difficult to ascertain why the town is reticent in realizing cost savings by disallowing elected officials to receive health insurance buyouts, especially considering no document could be found that includes elected officials in an employee approved insurance buyout plan approved by town resolution in 1989.

At their recent meeting, the board tabled a resolution proposed by Councilmember Dan Amatura that would prohibit such buyout if the individual had insurance from an outside source.

The board will consider eliminating buyouts for part time board members.

Highway Fund:

Spending went up 10.6%. Revenues were down 2.6%. The amount to be raised by taxation increased by $542,683, or 34%. Because taxable valuations only went up by 1.9%, the tax rate increased by 32%.

It is obvious this would be the department where escalating material and maintenance costs would most impact the budget. It should be questioned as to why the town did not allocate more reserve money to this fund to lower the tax rate and to therefore lower property taxes. $1.4 million was taken out of the $5.2 million Fund Balance, leaving $3.8 million in reserves, 14%.

$300,000 was taken from the 2008 reserves and used to soften the highway budget. Only $125,000 was taken from reserves this year. I imagine it’s because Highway reserves this year are $337,836.

Comment

As the saying goes, “It’s the spending stupid.”

While residents have to adjust priorities or make sacrifices that can have serious impacts to their well being or quality of life, the town boasts of maintaining the status quo while putting more burden on the taxpayer.

And they do all this while setting the poor example of taking health insurance buyouts at $6,600 per year when they have outside insurance coverage.

And as of now, four union contracts that are near expiration have not been negotiated.




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