DOVER — In January, Dover City Council voted 7-1 to add 10 officers to the city’s police department. Now comes the reckoning on how to pay for them.
If city manager Scott Koenig has his way, residents will pay more in property taxes to help bear the cost of the city’s increased spending, including enlarging the Dover Police Department from 92 to 102 officers.
The recommended property tax increase is outlined in Mr. Koenig’s 1¼-inch thick proposed operating budget for Fiscal Year 2015-2016 presented to the council in advance of review hearings scheduled for Wednesday and Thursday. The proposed budget sets a general fund of $41.8 million, with revenue $4,900 ahead of expenses. It projects revenues at $41,830,100 and expenses at $41,825,200.
In the cover letter, Mr. Koenig says the property tax increase is necessary to keep the operating budget balanced, as required, between revenue and expenditures.
The proposed increase does not surprise some on council.
“We can’t continue to address the financial means of the city without increasing taxes,” Councilman James Hutchison said last week. “With the addition of the 10 officers, that puts a stress on the budget, but adding those officers was needed for the city.”
Based on an estimate of $1.5 million needed to pay for the officers’ salaries, equipment and other costs, the move will cost an extra $4 million over the next five fiscal years.
Mr. Koenig says the budget, outlined in 329 pages, “complies with all financial policies.”
The proposed budget first states that due to property revaluation, the property tax rate needs to increase from 33.78 cents per $100 of assessed value to 34.99 cents to keep the revenue at its current level. That would mean the average property owner would pay at least 3.6 percent more in taxes. The proposed budget does not elaborate on figures for “average.”
However, to cover proposed increased spending — including enlarging the police department — while maintaining a balanced budget, Mr. Koenig proposes an additional 7.01 cents per $100.
Ultimately, the proposed property tax rate for fiscal year 2016 would be 42 cents per $100 of assessed value.
“This represents a total increase of $0.0822 or 24.3 percent increase in the property tax rate,” Mr. Koenig says in the letter.
City residents also would pay more for electricity under the proposed budget since it calls for an average rate increase of 3 percent
However, water and sewer fees would remain unchanged.
The proposed budget includes pay increases for some city workers, based on collective bargaining agreements, and non-bargaining employees. It also takes into account rising costs of employee benefits.
The proposed pay increases comply with agreements made with the International Brotherhood of Electric Workers and the American Federation of State, County, and Municipal Employees Council 81. No agreement has been reached with the Fraternal Order of Police Lodge No. 15 or the Dover Organization of Employees so no salary increases were earmarked for those employees.
Mr. Koenig’s proposed budget allows for a 3 percent pay increase for non-bargaining workers making less than $85,000. It would be 2 percent, plus a 1 percent bonus, for those making $85,000 and more. The budget also accounts for adding 14 full-time and 15 part-time positions.
Total full-time workers would go from 347 to 361 and part-time from 78 to 93.
“The economy hasn’t sprung back in the state the way we all expected it to,” Mayor Robin Christiansen said last week. “We have some challenges to maintain city services at levels citizens expect and I think we’re up for the challenge.”
He sees a tax increase as a last resort.
“We have the responsibility to always keep that option on the table,” he said. “Over the past few years we haven’t had any tax increases.
“We’re going to have to take a look at the budget and see if there are any areas that we can cut and after that we will have to talk about a tax increase if it’s necessary.”
The last time the city had to raise taxes was in 2010, but Councilman William Hare believes it’s too soon to decide if an increase is necessary.
“It’s a proposed budget,” he said. “When we sit down and discuss it, then we will be able to know if we need to increase taxes. I think it’s too early to make that call now.”
Councilman David Anderson, however, believes maintaining the public safety of residents is a top priority for council.
“I hate the idea of it,” Mr. Anderson said of the proposed tax increase. “But we can’t hire more police officers, which are needed, and not be able to pay for them. If we do increase taxes, it’s to maintain the public’s safety in the city.”
But Mr. Anderson said he hopes to limit the tax increase as much as possible.
“We have to just be up front with people,” he said. “If we are going to raise taxes, I think people will understand that we had to do it, due to adding more police officers.
“They want to know that they’re getting their money’s worth. I know I’m going to work as hard as I can to make sure the taxes are held as low as possible,” he said.
“We have our work cut out for us, but I’m confident that we’ll figure it out.”
City Council will meet at 7:15 tonight in the City Hall Council Chambers. The Legislative, Finance and Administration Committee will meet beforehand, at 6 p.m.
Special council meetings to review the budget will be held at 6:30 p.m. Wednesday and Thursday. Council has until June 8 to adopt a budget for 2016.