“We’ve incorporated a fresh look at some of the revenue assumptions we have and some pessimism going into the ‘21 year and finishing up the ‘20 year,” said Finance Director Ken Keim. “For instance the most impactful thing that’s happened to us with this COVID thing is the hotels.”
The monthly sales tax collection last year in May was $101,642, and this year it fell to $17,570. Keim said he is assuming the lowest monthly collection in his projection for next year’s receipts so he budgeted a $483,313 drop from 2019 actual receipts.
Keim projected a 5% increase in property taxes, or $1.75 million, due to the recent mandated property reassessment. The township also receives income taxes from Joint Economic Development Districts. Keim budgeted a JEDD reduction of $151,787 for a total $1.46 million.
The township’s 2020 tax budget estimated total expenses at $71.8 million against $56.1 million in revenues. The bulk of the $8 million difference in expenses was due to the $20 million Union Centre Boulevard interchange project over Interstate 75 that is nearing completion. The township used $6 million in cash from the UCB Tax Increment Financing fund to help pay for the upgrade.
The November election will determine the final budgets for police and fire. The trustees were expected to formally put levy questions on the November ballot for two new 2-mill levies Tuesday night, which would generate about $4.4 million each.
The existing 6-mill fire levy has gone untouched, meaning it hasn’t been replaced or adjusted at all, since 2006. For police, it has been since 2010.
Safety services are the largest expense for the township and next year the total for both is nearly $31.5 million. The expenses for police are estimated at $17.3 million versus $14.2 million in revenues that fund has $9.6 million in carryover. The fire department budgeted $14.14 million in expenses, $11.7 million in revenues and expects a cash balance of $7.7 million to start next year.
As levies age, with expenses continually rising due to cost of living and other pressures, reserves dwindle. Levies generally have a shelf life of five years. The reserves for the safety services funds will dry up in the next couple years. Keim did not include the levy amounts in the 2021 revenue projections.
Keim noted that the tax budgets will likely change before the final appropriation is approved for next year.
“Each of the department directors are asked okay so what’s the plans with capital improvements, what’s plans with head counts, what’s the plans for anything out of the ordinary going into 2021,” Keim said. “We just assume it’s all going to get spent... but as we get together in the fall we get more realistic.”
Trustee Board President Ann Becker said while the expenses for next year exceed revenue projections at this juncture, rarely is all the money spent because projects and purchases drop off the list.
“Our budgeting is always very conservative on the spending side so our budgets always have spending within them we may do or we may not do, just depends on year-to-year if projects get done,” Becker said. “So our actual budgets are usually a lot lower than our planned budgets.”
About the Author
