BERLIN – Residents voiced frustration over municipal expenses and concern regarding a pending tax increase at a special budget meeting this week.
On Tuesday, more than a hundred Berlin residents attended a public budget listening session hosted by the town’s elected officials at Stephen Decatur High School. Attendees expressed concern about the impact the proposed property tax increase — which is expected to range between 20 and 34 percent — would have on seniors living on fixed incomes. Others criticized the 2016 purchase of Berlin Falls Park and the town’s rising operating costs.
“You should stop and think of the senior citizens,” longtime resident Betty Hudson said. “Quit spending money that you don’t have.”
In a late February work session, town officials began discussing potential tax and fee increases for the coming fiscal year. Citizens were quick to begin voicing concern when they learned a 34-percent property tax increase was being considered. Tuesday’s listening session was scheduled to provide residents with a chance to share their thoughts on the issue.
Resident Don Fletcher told the council that if the issue was the fact that the town’s utility funds hadn’t been breaking even for years and had instead been supported by loans from the general fund, the council should have addressed the issue.
“How could we not know for seven years?” he said.
Mayor Gee Williams replied that in hindsight he wished the town had been able to adjust its sewer fees more frequently to address the expense of spray irrigation. He said the process was expensive and had increased utility costs more than expected.
Fletcher said that nevertheless, gradual rate increases would have been the way to go.
“Rates would have been better going up year to year than all at one time,” he said, drawing applause.
Franklin Knoll resident Barb Ogurcak agreed. She said she was trying to sell her house — partially because she was tired of dealing with the special events in town — and a buyer had backed out upon hearing the news that the town was exploring a 34-percent tax increase. She said that if the town raised taxes that much, the market would be flooded with homes for sale.
“We’re going to end up with foreclosures,” she said. “We’re going to be living 2008 all over again. You can’t do this. You can’t do this all in one tax increase. It’s not fair to us.”
Resident Barb Gallagher said she was a retired widow and wouldn’t be able to afford the proposed increase. She added that she wouldn’t be able to sell her house because it was in a neighborhood known for its flooding.
“People in my situation can’t afford to live here, can’t afford to leave,” she said.
Cameron Drew, a member of the Coastal Association of Realtors board of directors, said she was speaking on behalf of 1,000 real estate professionals. She said for a $265,000 home, a 20-percent tax increase would mean about $300 more in property taxes while a 34-percent increase would be more than $500.
“From the lender’s point of view, these increases are going to affect buying power because they’ll be facing a higher monthly mortgage payment that may not be affordable,” she said. “For people that already live here, this increase is going to impact their escrow calculations.”
She said the number of local homes sold had increased slightly in recent years.
“Your market is recovering just like everyone else’s but it’s a slippery slope especially when you’re possibly pricing an entire income bracket out of your market,” she said.
Hudson expressed concern about town spending and asked if the town was supporting the Berlin Fire Company (BFC).
“We provide more money per capita than any town anywhere around here,” Williams replied. “Our grant this year is $605,000. Compare that to Ocean Pines or other communities.”
Resident John Holloway, a member of the Berlin Fire Company, said he wanted to correct the mayor’s statement. He said that in fiscal year 2013, the fire company received no funding from the town. In fiscal year 2014, it received just $200,000. He said that from 2013 to now, the fire company’s funding from the town had been reduced by $1,520,000.
“You do not support the fire and EMS services of this town,” he said. “I’d like to know where that $1,500,000 went. What did you use it for? Why are we still in the hole? That money could have been used for something else.”
Williams said the year and a half that the town had not funded the fire company was because it did not want to be a part of the lawsuit the BFC faced at the time. The harassment lawsuit, filed by former BFC member Zack Tyndall (who is now a councilman), was settled for an undisclosed amount in 2015.
“So you put people’s lives in jeopardy by not funding the services,” Holloway said.
Williams said lives were never in jeopardy.
“That’s because we continued to do our job…,” Holloway said. “The fact of the matter is people pay taxes for fire and ambulance service in this town. Those services have still been provided but our funding has been reduced. I don’t want to have that be a reason our taxes are going up. I don’t want to hear that excuse.”
Robin Tomaselli, owner of Baked Dessert Café, shared her thoughts as a business owner. She said the increases proposed would affect merchants as well as residents. She expects landlords to increase what they charge business owners in rent if their taxes and fees go up. She said that Berlin remained a seasonal town and that small business owners already struggled to get through the seasons.
“I have to save every dime I can from the busy season to survive the winter,” she said.
Longtime resident William Campion, 85, said he was a retired locksmith who lived on a fixed income. If he can’t afford whatever increases the town approves, he’ll be forced to become a charge of his children.
“You should have raised every year 2 or 3 percent,” he said. “You shouldn’t have waited this long. The only thing I can say about it all is there’s an election coming up.”
Councilman Dean Burrell said that while residents might say the council had been slow to act on issues, they should acknowledge that officials were listening to what residents had to say.
“I wish that we had been getting this type of input for those years that have passed,” he said. “Hindsight’s 20-20. When you have public meetings — two public meetings a month — and except for the newspaper the attendance is three to four individuals, we think your silence is your approval. That has evidently been a misconception.”
When the issue of the town’s $2.5 million purchase of Berlin Falls Park was raised by residents, Williams explained that selling it would not have a significant effect.
“It would not impact the reserves at all,” he said. “All it would do is pay off the loan.”
Resident Jason Walter told the council he’d used a website, cleargov.com, to compare Berlin’s budget and tax rates to comparable towns throughout Maryland. He said Chestertown, which had a slightly larger population than Berlin, had recently increased its tax rate to .42.
“Our current rate is .68,” Walter said. “You want to claim it’s low. That’s just not true.”
He added that Berlin spent more than Chestertown on general government as well as more on police, economic development and salaries.
“I think my opinion Berlin spends too much is actually fact,” he said.
Resident Brittany Jarman said the town should focus on new ways to increase its revenues. She suggested charging residents to park at Berlin Falls Park during the town’s special events or charging entrance fees at town events.
Williams thanked her for the ideas.
“Most of the input we get is when something’s wrong or somebody needs something,” he said. “Up until these last few week’s it’s been sort of like trying to read tea leaves.”
The Globe owner Jennifer Dawicki acknowledged that the lack of citizen feedback had been interpreted as approval and said it was imperative that residents stayed involved. She asked that the town maintain its single tax rate — not moving to a two-tiered system that would tax residential and commercial properties differently — and that an incremental increase be pursued.
Resident Joe Shelton called for officials to cut the town’s expenses.
“Trim some of your budget to help the taxpayers of this town,” he said.
Resident Marie Velong said she resented the fact that town officials had kicked off tax increase discussions with a 34 percent increase. She said they were just trying to shell-shock residents so they wouldn’t object when a 20-percent increase was finally approved. She suggested the town start with a 5-percent increase.
“Then you might get more cooperation and less agitation,” she said.
Velong added that the town should also stop accumulating property it would be responsible for maintaining. She referenced the Flower Street Multi-Purpose Building and Berlin Falls Park.
“It seems like it’s not the beautiful park we thought it should be,” she said. “We should think about selling it.”
Washington Street resident Jim Manley said that if the cause of the town’s financial problems were water and wastewater expenses, the town should just increase those rates and not adjust tax rates.
Williams said the budget, even if it was cut the 10 percent officials planned to cut it, still needed to be replenished. That, he said, could only be done through a property tax increase.
Manley said he appreciated the fact that the town had scheduled Tuesday’s listening session but asked why Councilman Troy Purnell was not in attendance.
“What was more important than being here to answer to the people?”
Another resident asked if the evening’s comments would even impact whatever rates the council approved.
Williams stressed that officials hadn’t even discussed the rate beyond the February work session where the range of potential increases was first reviewed. He said the whole reason the town had brought the issue up early was so that residents would be aware.
“Normally we’d be talking about this in early May,” he said.
Councilman Zack Tyndall told those in attendance he’d been “taking notes vigorously” and hoped to make improvements to the budget process in the future.
Resident John Paul Adkins told the council that its auditing company should have identified the financial strain caused by the town’s utility operations.
“They should have been telling you that it looked like there was going to be a problem,” he said. “If they didn’t I’m not sure about the folks that represent you.”
Resident Linsey Parker said the numbers Walter shared indicated the town’s expenses were greater than necessary considering its size. She was also critical of Berlin Falls Park and pointed out that the town was paying employees to support it and was spending money to tear down the old buildings located on the property.
“It seems to have been bought without any concrete plan,” she said, adding once it was developed, there was the issue of it taking business away from Main Street. “Is it time to cut bait and go so we don’t continue to drain money down the pit?”
Williams said all concerns would be considered though it was unlikely they’d all be solved in the next few months.
“It’s amazing,” he said. “I never heard, less than half a dozen people even talk about that until we had the proposed increases.”
The mayor stressed that the property, which used to be a poultry plant, had been a problem for years before the town purchased it.
“If you lived in the northern part of town, there were times you’d have to go to the restroom and throw up because of the stink being so awful,” he said. “It wasn’t just for a few minutes. It was day after day.”
Parker said that if the property had been bought for the good of the town it was still a lot of money.
Williams maintained that the town now had control of what had been an “environmental nightmare”
“Is the town going to purchase every derelict property?” Parker said.
Williams said that buying the former poultry plant was the only way the town could get control of the property.
“If we don’t take responsibility, there’s nothing that can be done,” he said. “Property rights trump everything.”
Resident Patsy Adkins praised Walter’s efforts to compare Berlin’s expenses to other towns. She suggested town leaders visit the towns he’d mentioned that had lower costs than Berlin.
“Figure out how they are doing it,” she said.
Another resident suggested the town hold its department managers accountable.
“Managers are the ones spending the money,” he said.
Tyndall said he’d made a good point.
“You got one thing wrong,” he said. “The buck stops here on our shoulder. Not our department heads. If we go over budget, it’s our fault. We have a lot of great employees. I stand by them.”
The council will next meet April 1 for a general fund budget work session.
