OCEAN CITY – The Mayor and City Council wrapped up the proposed Fiscal Year 2016 (FY16) Operating Budget yesterday, deciding how to allocate a portion of fund balance.
A few weeks ago, City Manager David Recor presented a balanced FY16 Operating Budget based on a tax rate set at constant yield of 47.8 cents for $100 of assessed property value. The town’s current property tax rate is set at 47.04 cents. The property tax rate proposed by the city manager will generate $40,239,417.
Budget Manager Jennie Knapp explained as of the end of Fiscal Year 2015, which is June 30, approximately $2 million will be available for appropriation, which leaves over $11 million in reserve, meeting the town’s fiscal policy of 15 percent of previous year General Fund expenditures. To be on the safe side, Knapp gave the council $1.5 million out of the $2 million to be appropriated at that time.
The council turned to a list of items that were not funded in the originally proposed FY16 Operating Budget, focusing on the items that are listed as priorities in the strategic plan.
Mayor Rick Meehan turned to several items, a couple of which have been priority capital improvement projects for the past several years.
He started with the 65th Street Public Works Complex, which is slated for redesign in conjunction with the state. The project is priced at $13 million with $9 million of that available in a grant from the Maryland Transportation Administration (MTA). Currently, $325,000 is needed for design with $125,000 already included in the budget.
“What is needed is $200,000,” the mayor said. “MTA wants to issue an order to commence design this month, and it takes about a year for the design to be completed. If we don’t meet the time table, then we might not get into the stream to have this done.”
Council Secretary Mary Knight pointed out if the town does not commit this fiscal year the MTA grant funds would be lost.
Currently, just over $1 million is in the budget to conduct street paving. The town has strived to dedicate $2 million a year to street paving and only $1 million was included in the proposed budget.
The mayor pointed out an annual $300,000 State Highway Administration grant was not included in the budget because it has not been guaranteed as of this time. He suggested allocating $500,000 to street paving and recognize savings occurred throughout the year will be allocated to street paving.
In the FY15 Budget, $250,000 is allocated to canal dredging but in FY16 $750,000 was left unfunded.
“The goal was to have $500,000 per year for five years. We spent $500,000 out of savings from two years ago, and this year we have $250,000, so to catch back up we would need $750,000,” City Engineer Terry McGean explained.
The next section to be dredged is Caine Keys II, which is Old Landing, Winter Harbor, Channel Buoy and Old Wharf roads. It is about $1.2 million worth of dredging. The mayor suggested allocating $500,000 to canal dredging.
“Canal dredging has been a priority for two years now. I hear right away from somebody who has had their canal dredged or from those who haven’t,” he said.
The town is also investigating Phase III of the Roland E. Powell Convention Center expansion project, which has been a cost share with the Maryland Stadium Authority (MSA).
A couple of weeks ago McGean came before the council explaining a request was submitted to MSA to begin the study of Phase III. The initial cost to the town for the study is $35,000 that is not included in the proposed budget.
“In regards to Winterfest of Lights, there are some desperately needed repairs and enhancements for the very popular winter season event,” the mayor said, suggesting $25,000.
The mayor also recommended allocating $40,000 to paint two trash trucks.
The mayor’s list totaled $1.3 million out of $1.5 million that is available to be appropriated, leaving a balance of $285,000 for others projects to be considered.
Councilman Wayne Hartman agreed with the mayor on all items except he asked for the amount to be appropriated for canal dredging is increased to $600,000.
“We are already $250,000 in the hole, so to make up some of that deficit in the schedule,” he said.
After more discussion, Hartman made a motion to approve $500,000 in funding for street paving, $600,000 in canal dredging, $35,000 for the feasibility study of another convention center expansion, $40,000 for painting two trash trucks, $25,000 to improve Winterfest, $200,000 for the Public Works Campus Study, $14,000 for ballistic windows at the police department, $10,000 for a police social media recruitment campaign and $30,000 for City Hall security enhancements.
The council voted 6-0, with Council President Lloyd Martin absent to approve, leave the tax rate as originally proposed.
“I really thought this was going to be a much more difficult process, and I really thought there was going to be more differences in opinion. Everybody is here because they are passionate about the town. Seeing how easily agreeable everybody is, shows how cohesive we are,” Hartman said of the current council.