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Next year's Ashland budget won't see reduction Debt service and internal borrowing offset the cutbacks By TONY BOOM Mail Tribune ASHLAND - A hoped-for reduction in next year's city budget won't happen, but property taxpayers should still see a rate reduction. City officials had expected the overall budget to decrease to about $87 million because several large capital improvement projects are near completion. But increased personnel costs, debt service and internal borrowing offset the reduction. A 2-cent drop in property tax rates per $1,000 of assessed value is projected, while total city expenses increase less than 1 percent under a proposed budget for 2002-03. The total budget would be $91.3 million, compared to last year's $90.4 million. Property taxes total $7,028,000, or 8 percent of the total budget. The city would levy $5.36 per $1,000 of assessed value. That amount includes $1.47 for city services, $2.09 for parks operations, $1.39 for the youth activity levy and 41 cents for bond levies. Increases in property value could raise total tax bills. Budget committee members received the proposal April 11. Subcommittee meetings for department presentations continue on Thursdays until May 16, when the full committee meets to recommend a budget to the City Council. A subcommittee on Thursday approved consideration of an additional $205,000 for the parks department at the May 16 meeting. The money would be used for grounds maintenance at Ashland schools. Mayor Alan DeBoer has proposed city aid to help schools, which face a cut in state funds. DeBoer said schools benefit the city, adding, "I consider the grounds as parks and playgrounds for most of our kids." DeBoer has said the city carries too much money in ending fund balances. An ending balance of $23.4 million is projected for this year. DeBoer says about $260,000 should be used for the one-time aid to schools, which includes other assistance in addition to the groundskeeping. But one councilman said the end balance issue needs careful study. "I think that we have to examine very carefully how those fund balances are used," Councilman Don Laws said Friday. "I think the mayor has just looked at the totals." Some end balances provide operating money until tax revenues are collected in November, said Laws. Use of equipment reserve funds could mean higher costs or a bond measure to finance purchases. The city also saves money through self-insurance, which requires a reserve, said Laws. Ashland Fiber Network will borrow $6,625,000 from other city departments to finance operations and construction. Last year AFN borrowed $4,500,000. A revised AFN business plan developed last year calls for the loan. The loans are repaid at the end of each fiscal year. Loans cause the budget to appear larger than it is because funds are counted twice, said Lee Tuneberg , finance director. Increases in city fees and services are included. Electricity rates are scheduled to increase by 6 percent on July 1. An electricity surcharge, introduced last year when future wholesale electric costs were predicted to jump as much as 200 percent, will be increased to 16 percent from 10 percent. The surcharge should be reduced in future years. Water rates would increase 5 percent, but there is no proposed change in wastewater fees. City departments have asked for seven new positions not in the budget that will add $325,000 to the city's payroll. Citizens, budget committee members and council members may also propose budget changes. Reach Ashland bureau reporter Tony Boom at 482-4651, or e-mail [email protected] Mail Tribune Home | Ottaway Newspapers, Inc. | Dow Jones & Co., Inc. | Privacy | Contact Us Copyright � 2001 Mail Tribune, Inc.