Published: November 14, 2008 10:24 pm      

NIAGARA COUNTY: Tentative budget shows line held on spending

Niagara County Manager Gregory Lewis on Friday released a tentative 2009 budget that includes no increase in the amount to be raised by taxes and projected tax rate decreases for 10 of the county’s 15 towns and cities. North Tonawanda property owners are projected to see their rates go up by four cents per $1,000 of assessed valuation.

The proposed 2009 spending plan calls for a property tax levy of $67.8 million, the same as 2008. While tax rates will vary depending on state equalization rates for individual towns and cities, the budget projects a 21-cent decrease in the full value tax rate from $7.78 to $7.57 per $1,000. Based on those projections, the average county home valued at $100,000 would be reduced by $21 next year. The budget calls for total spending of $304 million, an increase of $2 million, or .68 percent.

Lewis and county department heads were under pressure from legislators to recommend a spending plan that included no increase in taxes. Lewis said sound, long-term planning and support from union members were all keys in allowing the county to maintain services without raising taxes despite the difficult financial conditions faced by the state and federal governments.

“We know that (taxpayers) are living in tough times,” Lewis said. “We did not want to raise their burden and we did that through a lot of hard work.”

The release of the county’s budget comes at a time when state lawmakers are considering hefty cuts in spending to close projected budget gaps of their own. While acknowledging that the county cannot anticipate what will happen with the state’s finances moving forward, Lewis and Budget Director Dan Huntington expressed confidence that the structure of their spending plan will allow the county to adjust to reasonable cuts in aid through 2009. The following year, Lewis said, could be a completely different situation.

“We believe, from our analysis, that the (challenge) will be the 2010 budget and beyond,” Lewis said.

Based on projected 2009 tax rates for individual municipalities, taxpayers in the Town of Hartland would see the largest rate increase next year, up 63 cents, or 8.1 percent, over the current tax rate. The biggest decrease would occur in the Town of Royalton where the county tax rate is expected to decrease by $1.73 per $1,000 of assessed value.

Once again, nearly $5 million from the fund balance is being applied to the budget to offset increases in expenses and to avoid the need to raise taxes. Next year’s proposed fund balance allocation is $4.98 million, up $48,949, or .99 percent, from 2008. Under legislation adopted by the Legislature in 2002, the county is allowed to designate fund balance up to 6 percent of the total gross expense of the current year’s budget. Both Lewis and Huntington indicated that the county’s surplus remains healthy even with the allocation. The county’s 2007 audit showed a fund balance of $21.6 million or 7.8 percent of 2008 budgeted total gross receipts.

“Fund balance was used as revenue so we didn’t have to raise property taxes,” Huntington said.

The spending plan also benefits from an increase in revenue for supplemental Medicaid payments of $1.7 million. The one-shot revenue stems from adjustments made to rates paid to the county for patients who lived at Mount View Health Care Facility, which shut down completely at the start of this year. Lewis said the state’s Medicaid cap also has helped the county avoid a significant increase in overall expenses for the program. The county’s 2009 Medicaid costs are expected to be $42.1 million, up about $1.1 million from 2008.

Employee benefits and salaries account for $107.2 million or about 40 percent of total spending. Department heads and attorneys, as well as members of the CSEA, PBA and probation unions are all scheduled to receive 3 percent salary increases next year. The budget includes two new positions — an insurance program assistant and a system accounting manager. The insurance program assistant will concentrate on active and retiree healthcare and the position’s salary will be covered by funds from the county’s self-insurance program. The system account manager will be responsible for management of county financial transactions. According to Lewis, the county also realized more than $1 million in savings as a result of nearly all of its unionized employees moving to a single, health insurance provider.

County legislators will review the tentative 2009 budget during hearings scheduled for the coming weeks. The finalized version must be adopted by Dec. 20.