METHUEN — Two dozen fire, police and public works employees could be laid off if the budget is cut to achieve an average property tax increase of $100, Mayor Stephen Zanni warned yesterday.
City councilors are putting pressure on Zanni to keep the tax increase to the $100 figure he cited when the budget passed in June. City officials estimate the hike would be $194 based on spending, tax revenue and state funding, but have said they would offset that by taking some money from city reserve funds to soften the increase to $137.
Zanni, citing state funding that came in $1 million lower than he originally budgeted for, said he did not want to reopen the budget and warned that hitting that $100 target would require a 3.5 percent cut across the board, totaling about $705,000.
“What that would mean, in DPW a layoff of nine laborers; police, a layoff of eight patrolmen, and in fire services, seven firefighters,” Zanni said.
He said most departments in the city are too small to make cuts that would get close to $705,000, meaning they could not offset public safety and public works cuts. “You’re talking small money,” he said. “A lot of these departments only have a few people in it.”
Councilor Thomas Ciulla said he did not want to cut public safety and public works departments.
“Police, fire, DPW, those departments will be impacted if the city council wants to do that,” he said. “Those are vital services we have. I don’t want to see those services impacted. Those are important departments.”
But many other councilors, in interviews yesterday, said they wanted to keep the tax increase to about $100 and waited for a proposal from the mayor on how to get there.
“I want to see the cuts the mayor expects, unless he wants the citizens to pay $194 more,” said Councilor Jennifer Kannan.
Councilors said they wanted to reopen the budget to make cuts to at least bring the total increase down. Last week, the council’s finance committee asked the mayor for a proposal to reduce the increase below $137.
“I’d just like to be as close to $100 as possible without sacrificing services,” said Councilor Lisa Yarid Ferry, a member of the finance committee.
Two councilors, Ron Marsan and Jeanne Pappalardo, said they would work to reduce the hike as much as possible, but still would vote against a tax rate that included any increase at all over last year. Both voted against the budget in June.
“I don’t believe this can be sustained where every single year there’s an increase in taxes,” Pappalardo said. “People are having a tough time as it is making ends meet. There’s fixed costs and retirement and health insurance, but come on. Let’s give the taxpayer a break.”
Marsan, who met with the mayor yesterday afternoon to discuss ideas, said it was up to Zanni to propose the budget and the council’s job to approve or reject, not to amend. One reason a tax increase is needed, he and others said, was a series of municipal contracts negotiated and approved last year that included significant raises that totaled $1.8 million this fiscal year.
“The City Council as a whole has already overspent the existing budget with the raises,” he said. “The only way to get it down to zero is to make some serious cuts, and I don’t believe anybody is willing to do that.”
Marsan and Pappalardo voted against those contracts.
Pappalardo suggested reviewing overtime in both police and fire department budgets, a total of more than $2 million.
City auditor Thomas Kelly’s estimate put the average residential hike at $194, but officials proposed using reserve funds and other budget transfers to reduce that to $137.
Kannan worried that dipping into reserve funds would negatively impact the city’s bond rating. “One of the reasons we were downgraded (this year) was Moody’s said we did not have a plan. But the negative rating was removed because we had a plan to put money in reserves,” she said.
The average single-family homeowner paid $3,666 in property taxes in 2013 on a home assessed at $254,170. Property taxes increased on average $163 last year over the year before, and by $134 the year before that.
Zanni’s budget proposal earlier this year represented a 5 percent, or $6.5 million, increase over last year. The city council approved a $145.2 million budget in June, with councilors trimming just $189,848 from the mayor’s proposal.
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