OCEAN CITY – The next fiscal year’s proposed budget for the Town of Ocean City was presented this week with a total operating budget of about $130.4 million, along with an increase in the tax rate that will affect the average taxpayer by about $40 per year.
“While the information has been presented and characterized as the City Manager’s FY14 Proposed Budget, I would like to characterize it as the preliminary working budget because we are just beginning dialogue,” City Manager David Recor said on Tuesday afternoon. “The budget is balanced, however as we go through this high-level discussion today and review the various funds we will focus on the general fund.”
The Preliminary Town of Ocean City FY14 Financial Operating Budget was prepared by department heads, Budget Manager Jennie Knapp and Recor, totaling about $130,397,000 in spending.
That amount is divided into the following subcategories: the General Fund, $78.2 million; Water, $7.4 million; Wastewater, $12.6 million; Transportation, $9.7 million; Airport, $1.4 million; Golf Course, $2.1 million; Convention Center, $6.9 million; IT, $1.8 million; Service Center, $5.2 million; Vehicle Trust, $2.2 million; and Risk Management, $2.2 million.
“That figure was achieved by a lot of collaboration and discussion and cooperation with the city’s departments,” Recor said of the preliminary budget total. “There have been $4.2 million in reductions from what the departments had originally requested to the figure that is included in the preliminary budget that is equivalent to .0330 on the preliminary tax rate.”
According to Recor, the preliminary FY14 General Fund budget is based on the constant yield tax rate of .4620 plus an additional .0244 for a total preliminary tax rate of .4864 (or 48.6 cents per $100 of property valuation). Based on an average assessed value of $221,000, the average tax bill would increase by $39.56 when compared to the 2013 tax rate of .4585.
Recor reminded the room during the fall of 2012, the Mayor and City Council worked through a strategic planning process along with city staff and Ocean City residents to form a 15-year vision for the Town. The following five-year goals were established — financially sound town government, first class resort and tourist destination, more livable community for residents, excellent service through a high performing town organization and revitalized Ocean City development and redevelopment.
Recor furthered the FY14 Financial Operating Plan includes those five-year goals as well as the tentative priorities established by the policy and management agenda identified in the strategic planning process.
The top priorities of the 2013 policy agenda is evaluation, direction, the town’s role and action in a pedestrian safety/master plan, identification, evaluation and direction of alternative revenue sources, analysis and direction of tax differential, evaluation, recommendations, direction and funding of a parking needs study, services with the county, and tourism evaluation and market analysis.
The top priorities of the 2013 management agenda is direction, actions and funding of beach replenishment, citywide five-year financial plan with revenues/expenditures projections, advocacy and funding of a dual Route 90 Bridge, an update of the Comprehensive Plan and evaluation, direction and funding of an election system upgrade.
“I would like to point out that we did conclude about a month ago negotiations with our collective bargaining units,” Recor said. “I am pleased to report the FOP [Fraternal Order of Police] contract has been ratified by the union and the IAFF [International Association of Fire Fighters] contract has also been ratified … however it is worthy to note this initial draft of the Preliminary Financial Operating Plan does include the costs of year one of those collective bargaining agreements, as well as the equivalent wage adjustment for the general employees.”
The expense for employee salary increases for the FOP, IAFF and general employees is about $924,500. Other noteworthy expenses is the roof replacement at the Public Safety Building on 65th Street of $871,000, the payment of principal and interest on 2012 bonds in the amount of almost $797,000, six new positions in Fire/EMS is about $292,000, a transfer to the airport in the amount of almost $110,000, and FICA salary adjustment are about $70,700, which all total about $3 million.
Recor added another point of interest is a reduction in the appropriation for “Pay As You Go” street paving by $830,000.
“There are a number of other “Pay As You Go” projects in the CIP [Capital Improvement Plan] that have not been funded to the cost estimated around $750,000,” Recor said.
The FY14 proposed budget is available on the town’s website, www.oceancitymd.gov as well as the budget calendar, which includes individual department budget discussions beginning on Thursday, April 11 and through Friday, April 19.
“This was a really tough budget process because a lot of things the departments requested as we went through were cut,” Knapp said. “Some of them were things that should have not been cut, Public Works in particular … even though we are trying to figure out ways to close the gap. Also, be listening to things that got cut and the possibility that some of those things should be added back.”