PROPOSED 2020-2021 VILLAGE OF HASTINGS-ON-HUDSON BUDGET

March 18, 2019
 
Dear Mayor Armacost, Trustee Leaf, Trustee Lopez, Trustee Fleisig and Trustee Lambert:
 
Submitted herewith for the Board of Trustees examination and consideration is the 2020/2021 Village Manager’s proposed General Fund budget that totals $16,576,566. At this spending level, a tax rate of $6.08 is required, which when compared to the current year’s budget represents a $ .05 tax rate change. The tax levy is increased by 2.9%. This levy is compliant with the state law that establishes the maximum tax levy that may be budgeted without the need to seek an override. The levy would appear as a percentage to exceed the maximum allowable levy, however, it is compliant because of the unused tax levy capacity carried forward from the 2020/2021 fiscal year levy and the growth in property assessments.  The budget uses the net assessed values established by the Town of Greenburgh in the amount of $1,921,047,085 which reflects growth of 2.1%.
 
The budget was created over the last several months through a process involving input from the various Village Departments, analysis of financial data from the current fiscal and prior fiscal years, discussions with department heads, the Village Treasurer and Deputy Treasurer and input from consultants and service providers.  As I write this introduction to the budget, the current crisis surrounding the COVID - 19 Pandemic is raging, and as we discuss the 2020/2021 Budget in the month to come considerations of the potential repercussions of this Pandemic on the Budget will need to be considered.   
 
The General Fund budget which includes the Village contribution toward the cost of the library operations in the amount of $929,598, reflects an increase in appropriations in the amount of $541,893. The functional breakdown of the appropriations and revenues for the proposed Fiscal Year 2020/2021 budget is contained in a series of exhibits in the complete budget document.
 
Revenues
 
The proposed budget offers a projection of what the Village can expect to receive from State, County, and locally generated revenues. As a general statement, most revenue categories are projected to be stable with a few exceptions. We have projected that sales tax revenues will grow substantially to $1,535,000.  This estimate however, has been significantly reduced from the initial projection from the County of the amount of additional revenue the 1% sales tax increase would provide. Building permit revenues are projected to decrease slightly from the 2019/2020 fiscal year.  Fees from Parks and Recreation programs and Court fines are increased, however, this is largely in connection with corresponding appropriations resulting in a cost-neutral change. The mortgage tax is anticipated to be flat. We are now experiencing a decrease in interest earnings with the resulting revenues projected to decline  $30,000.
 
The Village’s outside independent auditor has affirmed the Unassigned Fund Balance as of May 31, 2019 at $1,755,136. The budget recommends no budgetary transfer from the fund balance to the capital reserve fund to allow the fund balance to grow parallel to the growth in budgetary appropriations so as to maintain a balance in compliance with the Village Policy. The fund balance as of May, 2019 is at 10.9% only slightly over the minimum amount required by the Board of Trustee’s policy governing fund balance of  10% of the operating budget and a decrease in the fund balance for year-end May 31, 2018. This budget is also designed to reduce the reliance on fund balance at fiscal year- end to cover expenses that has been employed in previous budget cycles. The budget reflects the philosophy to analyze and project revenues on a realistic basis.
 
Appropriations
 
As stated, the budget reflects an increase in appropriations of $541,893. The budget includes several new line items which have been included to further itemize appropriations and provide additional clarity as to what  tax dollars are actually being spent on.  In some instances  budget lines include expenses which were previously not evident in the budget because of the manner in which they were being accounted for. In addition, an effort has been made to appropriate funds in a manner that will avoid line item overages. The budget is intended to provide for the enhancement of the delivery of municipal services to the  Village taxpayers.  The Village municipal employees are a dedicated group of hard-working men and women. The budget is designed to provide them with the resources that they need to perform their jobs well. 
 
Some of the specific areas where you will see increases in appropriations include the Treasurer line where certain professional costs have been added or moved from another line; Legal Counsel where, in this ever more complicated regulated environment, we continually need to reach out for guidance and advice on a variety of special counsel matters and  Technology where we are investing in upgraded software to provide more accountability and transparency.  It was discovered in the course of Budget preparation that that the Fire Department Liability Insurance was not reflected in the Special Items unallocated insurance line in 2019/2020.  It has been included in that line in the 2020/2021 budget.   The increase to that line is in large part reflective of that. 
 
Public Safety appropriations are down due to numerous retirements of seasoned officers and an influx of new lower paid officers.   We wish our retirees the best and are grateful for their service but I caveat that this has resulted in an impact on health care since both the new and retiring officers are contractually covered by the Village’s health benefit plan.  Additionally, the collective bargaining agreement provides for generous salary increase steps to new officers from year to year and we will see the effects of this impacting future budgets.  The increase in Safety Inspections appropriations is largely due to the reflection of third-party review costs which were previously not reflected in the budget.  Several DPW lines have been adjusted to more accurately reflect actual costs associated with the services and you will see that personal services have been allocated by percentage among the various services that the DPW performs on a regular basis.  New lines have been added to Planning providing better detail as to where funds are being spent when appropriations are regularly observed from year to year, rather than including them in the broad category of Other Services. Employee Benefits contains a significant increase of approximately $200,000 attributable to Health care insurance, retirement costs and other benefits.
 
Debt Service
The Village total debt service which includes library and pool payments is in the amount of $1,544,312.  It reflects payments in association with the Bond Anticipation Note of 2019 as well as previous borrowings.
 
Traditionally, the Village has maintained a contingency line item in the General Fund budget. This year the appropriated amount is made in consideration of potential salary adjustments and unforeseen expenses.
 
Appreciation is extended to the Village department heads for their conscientious attention to the preparation of their operating budgets and especially to the Village Treasurer and Deputy Treasurer for their tireless efforts throughout the budget process. The team looks forward to presenting this budget during scheduled budget work sessions and the public hearing to be scheduled for April 7, 2020. We look forward to the examination by the Board of Trustees leading up to the adoption of the budget in April.
 
 
Very truly yours,
Mary Beth Murphy
 
 
COVID-19     census2020
 COVID-19            CENSUS 2020
 

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