Attachments

20180907-105336-fy2018-19 budget first draft.pdf

EAST PROVIDENCE — The council and the general public last week got their first glimpse at the Fiscal Year 2018-19 budget, presented presumably for the one and only time by Acting City Manager/East Providence Police Chief Christopher Parella during the body’s September 4 meeting.

The draft (see attachment at left) calls for an outlay of about $185.8 million dollars for the next fiscal year beginning on November 1, just about $5.4 million more than the $180.4 million approved for the current fiscal year ending on October 31. The administration’s proposal calls for a 2.9 percent tax increase, which is in line with what state-appointed Municipal Finance Advisor Paul Luba and City Finance Director Malcolm Moore each suggested at times was likely during budget discussions late last year and throughout this one.

In his preamble to the draft, Chief Parella noted much of the additional expenditures were associated with renegotiated contracts between many of the city’s unions of employees as well as anticipated costs of the governance change to a mayoral form and the likelihood of the passage of a November election bond referendum to construct a new East Providence High School. The manager-council form of government will continue for two months before the elected mayor-council form emerges upon inauguration set to take place in January 2019.

“I am requesting a tax rate increase of 2.9% that includes roughly .8% to help reduce the future tax impact of the new high school,” the chief wrote. “Without the additional tax for the new high school, the tax rate increase would be around 2.1%. The 2.1% increase without any consideration for the new high school is lower than what was projected in last year’s financial forecast because growth in our tax base has actually been higher than expected.

“This is a positive sign for our City because it indicates that economic development is accelerating in our City, and that this expansion will help modulate tax rates for all of our taxpayers. The proposed 2.9% tax rate increase will add approximately $112.58 to the tax bill of the average homeowner with approximately $32.41 of that amount being associated with prefunding some of the anticipated future debt payments for the new high school. Without the school debt prefunding, the tax bill for an average homeowner will increase in this proposed budget by about $80.17.”

The administration, for the most part, level-funded the operating expenses of nearly every department. Similar to the requests made by directors in FY17-16, when they asked for some $186.3 million in funding, but saw that figure cut by some $5 million, Chief Parella’s staff trimmed about $3.5 million from the $189.1 million sought this year by the respective department heads.

One of the departments proposed to see slightly less than requested was schools, where Superintendent Kathryn Crowley’s office requested $2.3 million more from the city, Chief Parella countering with a $2.2 million increase, including $150,000 in capital improvement funds.

“Our School Department has requested that in fiscal 2019 the City provide approximately $2.3 million in additional financial support towards their operations from what was contributed last year,” Chief Parella, in part, wrote. “While this is an extremely high increase year-over-year it is neither unwarranted nor unexpected.”

He added later in his remarks, “I attended the School Department’s budget workshop and have meet with the Superintendent and her Finance Director regarding their 2019 proposed budget that was passed by the School Committee. I am satisfied that the budget was prepared in a conservative fashion and reflects reasonable additional costs that are primarily associated with their four recently ratified union contracts as well as unforeseen special education requirements.”

The current administration has proposed setting aside $472,376 in anticipated cost of the new mayor’s office, the bulk of which would go towards salaries. Of the $268,590 proposed for the stipends, $90,000 was approved by the council as the yearly salary for the mayor position.

Of note as well, for the seventh consecutive fiscal year in the row the city is fully funding its ARC (Annual Retirement Contribution) and OPEB (Other Post-Employment Benefits) obligations.

Before the budget is finalized in mid-October, a series of workshops and talks during regularly scheduled council meetings will take place, including a public forum on Thursday evening, Sept. 13, at 7 p.m. in city hall.