Warning about using budget surplus: ‘The well has dried’
After years of using the year-end surplus to balance its budget, Penn Hills will not be able to afford to do so after 2018, manager Mohammed Rayan told council Monday.
“The well has dried,” Mr. Rayan said in a written report to council at a second public hearing on next year’s budget. “This surplus belies the fact the municipality is doingbusiness as usual. If the projected revenue through tax money is not increased in 2019, it will be a negative balancedbudget with no room to operate.”
The proposed 2018 budget holds the line on taxes but uses most of the municipality’s $4 million surplus to do so, leaving the year-end balance for 2018 at a projected $1 million.
The $57.4 million budget total includes the general fund, sewer fund, highway aid, capital improvements and funding for the new municipal center.
While revenues in the general fund are expected to increase by $622,255, to $27.8 million in 2018, expenses are projected at $30.7 million, including increases in wages of 2 percent to 3 percent for various bargaining units.
Road-paving and non-mandated sewer projects have been scaled back and payments for new vehicles will be deferred until 2019, accordingto Mr. Rayan’s report.
Residents will see an increase in sewer rates from the Allegheny County Sanitary Authority in 2018. MayorSarah Kuhn read a letter from Alcosan saying rates will increase by 7.5 percent in 2018 followed by 7 percent increases in each of the next three years to pay for rebuilding and renewing the region’s-sanitary sewer system.
Comments from the public included recommendations to increase the code enforcement staff to reduce blight and to hire a grant writer to pursue federal and state funds.
“I would reduce all departments by 5 to 10 percent and give the funds to code enforcement to reduce the number of abandoned and vacant properties,” Jim Getsy of Crescent Hills Road told council. Planning director Chris Blackwell said Penn Hills has several programs in place to address neglected properties.