Budget questions need to be addressed
On Wednesday night, the Town Council voted to raise property taxes by 3 percent in fiscal year 2017-18 due to what Town Council member Bobbie Lindsay called the town’s systemic cultural problem springing from a nearly $100 million underfunded liability in our employee pension fund over the next 30 years.
She noted that the town is in a financial “pickle” because we have a contractual obligation to protect employees’ retirement pay. But to do that, we must put millions of dollars in additional contributions into the Employee Retirement Fund each year in order to avoid that fund running dry in the future.
The problem, both Ms. Lindsay and Council Member Julie Araskog noted, is that the town has decided to finance these additional payments through taxation, not through pay cuts, hiring freezes or elimination of nonessential projects.
In the past, these measures were taken to bring spending down and keep the budget under control. Now the administrative mindset seems to be, do not tamper with anything related to our employees’ salaries, merit pay or cost-of-living increases.
And resist eliminating projects that we do not need nor can afford. While we value the excellent caliber and work of our town employees — as recently demonstrated in the superb reaction and coordination during Hurricane Irma — in order to continue providing their retirement benefits in the future, there have to be financial restraints now. We are not alone in this dilemma. Communities across the country are grappling with this situation. Pension plans are draining coffers nationwide as people are living longer and, as in Palm Beach, retiring earlier.
At the end of the evening, and after much discussion, Ms. Lindsay and Ms. Araskog were the sole votes against the $80.5 million 2017-18 budget, which passed; a budget that has risen about $4 million a year for the past five years while our population has remained relatively stable. Their vote underscores the notion that the public is not responsible for past project cost overruns, actuarial revisions and a $23 million loss in the Retirement Fund portfolio several years ago. I agree.
Because municipal governments are created and run for the citizenry, I hope next fiscal year’s budget will reflect a more careful look at how money is being spent and where cuts can be made. How many people do we really need to run our small town? How generous can we afford to be with salary and raises? How much can we afford to spend on Wish List projects? And how do we ensure fulfilling our prior obligations to employees going forward? Once these questions are successfully answered, we can take the pickle off our financial plate.
The problem is that the town has decided to finance these additional
payments through taxation.