The 2013 City of Jamestown budget, not unlike others in the past, exemplifies the need for structural changes in the way the City of Jamestown does its business.
The Chamber of Commerce and Manufacturers Association proposed $860,500 in cost reductions with no pay cuts, freezes, nor any drastic head-count reductions and the City Council did not act on any one of these. Our recommendations were ignored.
Furthermore, the last-minute way in which cash was pulled from the BPU to shore up the city budget is disturbing. In our view this sets a bad precedent. Yet, let's consider this for a moment: If the City Council had used even one-tenth of our recommendations ($86,000) coupled with what the city took from the BPU, and the increased forecast for sales tax revenue, the city could have passed a budget without a tax increase.
So our question is, given all of this, why a tax increase at all? Or, how about a tax decrease?
The city closed much of its budget gap by taking $420,000 in cash from the BPU. This was after they had apparently worked out a series of agreements with the BPU that included: a decrease in the city worker's compensation cost share by increasing the BPU's worker's compensation costs by $175,000, a cut in city street light payment to the BPU by $35,000, a reduction in the interest rate on a debt owed by the city to the BPU which totaled $8,700, and a rebate paid from the BPU to the city based on a lighting audit that totaled $206,000 for a total of $424,700.
So, the city garnered $844,700 from the BPU and then increased their estimated sales tax revenue to $125,000 for a total of $969,700.
Not one single meaningful structural change in the way city government is operated came out of this budget cycle. Again, the arbitrary cash amount taken out of the BPU plus adapting a small fraction of the cuts we recommended would have avoided the tax increase completely.
Our challenge to the city is to get to work on meaningful structural changes in 2013 including; consolidation of the city of Jamestown Police Department with the county Sheriff's Department; taking a serious look at its health insurance program particularly what it offers the city retirees, as we believe there is an opportunity to provide better coverage at a lower cost to that population; and sharing housing code enforcement responsibilities among various city departments such as the Fire Department and/or BPU.
These changes will also need to include a sober look at the head counts and functions in all city departments. These are the types of structural changes that need to happen to get the tax rate under control and create an improved environment for economic growth.
The city needs to create an environment that promotes growth of the tax base. The city's Department of Development has basically said they are not in the business of fostering business development,.
Steve Centi in the Dec, 9, Post-Journal stated that, "The Department of Development is somewhat of a misnomer. Department of Community Development might be a better title, because we do all the rehab stuff, the code enforcement stuff."
The city cannot simply cut itself out of its own ''fiscal cliff.'' There has to be a focus on revenues.
We are not talking about increasing revenues by increasing taxes. We are talking about increasing revenues by increasing the tax base. The city has a lot to offer in terms of infrastructure, water, technology, competitive utility rates and low cost housing. If the Department of Development is not the vehicle for promoting these assets and helping businesses grow and inspiring new businesses to come into the community, then the city needs to figure out a collaborative strategy with county Economic Development, the Board of Public Utilities, the Renaissance Corp., the Downtown Jamestown Development Corp. and others to grow the tax base.
We look forward to significant changes in the way the city of Jamestown operates in 2013 and beyond.
Todd Tranum is president/CEO of the Chautauqua County Chamber of Commerce and executive director of the Manufacturers Association of the Southern Tier.