Council staring down $3.6 million shortfall for next year

Dover City Council took a sobering look at next year’s city budget Jan. 29, and in the face of a projected $3.6 million shortfall some council members said it might be time to discuss increasing taxes and fees, no matter how unpopular those measures may be.

Council’s annual retreat, held in the City Hall conference room, normally is a day to talk about big-picture goals and initiatives the panel would like to take on in the coming year, but this year’s meeting was strictly about the numbers.

City Manager Tony DePrima presented council with a working budget plan that includes a 3% raise and no furloughs for city workers, the addition of 1 1/2 new city positions, several new police cars, and one new city dump truck.

DePrima said the draft budget reflects increased costs in some areas and reduced savings in other categories. For example, the city is expected to lose nearly $500,000 in savings from a hiring freeze and attrition scheme it instituted last year to rescue the fiscal year 2010 budget.

The proposal also includes a trash fee increase of more than 200%, intended to offset a jump in landfill fees levied by the Delaware Solid Waste Authority.

Councilman Reuben Salters said it’s time to think about more long-term solutions to the city’s cash flow problem.

“We haven’t had a tax increase and our employees expect a raise, our citizens expect services. How are we going to pay for it?” he said.

The last time city residents saw a tax hike was 2006, when the rate was increased to 33 cents for every $100 of assessed value.

Salters said council should have done more to gradually increase the property tax rate over time to keep it in line with expenses.

“If we had kept up, our rates would be higher but it wouldn’t impact the public so much,” he said.

Councilwoman Sophia Russell agreed with Salters.

“We know we need to do something,” she said. “When the bottom line comes down, we’re going to get caught with our pants down.”

Salters is not up for re-election this April, and though Russell is, she said she’s prepared to do what it takes to get the city’s financial situation under control.

“I’m not worried about the next election,” she said. “If my time is up, my time is up.”

Council President Beverly Williams made the point that DePrima’s draft budget is just that, a draft, and with council’s formal budget hearing process still months away, nothing is final.

Williams hedged on the subject of employee raises and suggested DePrima see what savings could be gleaned by cutting two positions from the city’s Economic Development Office.

“You can’t hold certain things sacred and say, ‘We’re not touching this,’” she said.

Salters also balked at the idea of raises.

“Three percent in a non-growing economy sounds like a lot,” he said.

While the council decided not to engage in any detailed discussion on budget cuts or tax increases just yet, DePrima did ask the members to take his draft budget home, mark it with a red pen and bring it back.

Councilman Tim Slavin, who announced he would not seek re-election this year, said his colleagues should have known this budget would be tough when they passed the last one.

“It would be disingenuous for us to express surprise at this budget,” he said. “The difficult actions we deferred last year are here again, and they’re more difficult.”

Email Doug Denison at doug.denison@doverpost.com