Borough prepares midyear budget

WEST CHESTER » In light of global pandemic-related losses, the borough is going back to the drawing board.

During Wednesday’s special virtual meeting of the Finance and Revenue Committee, members Bernie Flynn, Bill Scott and Nick Allen, along with staff, grappled with how to best overcome a projected $4.4 million deficit.

At a recent meeting, council voted to defer about $2.2 million in nonessential spending of that $4.4 million loss for nonessential spending and capital improvement projects.

Part of the shortfall is directly due to parking revenues. The borough generates $400,000 per month in parking revenues and in March stopped enforcing parking meters and charging fines.

It is expected that many of the meters will soon start to be enforced.

Council is mulling over shutting down four blocks of Gay Street to make way for a pedestrian concourse for diners and shop patrons to shop and dine without vehicular traffic. This would also impact parking revenues.

About 40 of approximately 150 borough employees were recently furloughed in a money saving move.

Committee Chairman Flynn said the borough is entering unprecedented times and facing unchartered waters.

“This is a time we’ve never had to face in the borough, ever,” Flynn said.

Barbara Lionti, finance director, said the borough has lost $4.4 million in revenue, with projected cuts of $2.2 million already considered. Still to be made up is an estimated $2 million shortfall.

Lionti said the borough is “on track” from last year’s budget numbers during the current time period.

Borough Manager Mike Perrone has asked department heads to revise budgets mid-stream, with likely no hiring freeze.

“If we do everything we’ll be fine, the question is do we want to do everything?” Perrone said.

The new budgeting is contingent on the borough entering the “yellow” phase during June, West Chester University students returning for the fall semester and with parking income restored, according to Lionti.

Some of the following cuts to police, public works, parks and recreation, administration and the parking departments have already been calculated as part of the $2.2 million shortfall, with others not yet. The budgeting is a work in progress.

Police Chief Jim Morehead made suggestions that might cut $587,000. He suggested delaying equipment purchases and not rehiring following retirement and resignations of officers, in a bid to trim the police budget.

The chief proposed $330,000 of delayed hiring, over 12 months, while specifically not replacing three officers and the slicing of overtime payments by $126,000.

An employee furlough in the records department has saved $18,000 to date. Also, recently promoted officers have agreed to not take pay raises for several months.

Purchase of new weapons, pegged at a cost of $25,000, a new car at $57,500 and training costs for $15,000, might wait.

Up to four police officers might also retire in the fall.

Morehead said that the cuts are temporary and diminished finances would impact service.

“People have become accustomed to a service and we want to provide a service,” Morehead said.

He also said staff levels are “properly fit” to the borough’s size and growth.

The Public Works Department will face cuts and some state funding set aside for what is typically paving work will be used instead for other road improvements such as signage and striping.

For the Parking Department, Director Clark Elms said that $900,000 in savings might be realized, including $300,000 for roof repairs to the Bicentennial Garage and delaying purchase of a new garage parking kiosk to the tune of about $300,000.

The borough might increase fees due to total provider charges of $100,000 for those who pay with credit cards. Perrone said the increase might be levied across the board, with all those paying for some bills, no matter in what manner, realizing an increase. This is not set in stone.

The long anticipated hiring of an assistant borough manager has been pushed off and Perrone warned that he would need a year to groom his replacement.

Several events have been scrapped and Perrone said he doesn’t think the Restaurant Festival, scheduled for September, will be held. The committee considered charging a dollar for each parade participant, like some other municipalities do.

Allen is council’s newest member and talked after the meeting.

“Thankfully, the borough is not at risk for bankruptcy as the current $2.2 million shortfall is less than a quarter of our capital reserve fund,” Allen said. “However, we owe it to our taxpayers to check, then double-check, then triple-check that anything that can be deferred is deferred and that everything nonessential is cut as to not needlessly drain our rainy-day fund.

“We are looking at every option to cut expenses and increase revenue and I’m optimistic that this deep dive into our finances will only strengthen the borough without impacting the quality of services we provide to our residents.”

“We owe it to our taxpayers to check, then double-check, then triple-check that anything that can be deferred is deferred and that everything nonessential is cut as to not needlessly drain our rainy-day fund.” — West Chester Borough Councilman Nick Allen