What is happening with the Ashland Budget for 2017-2019?

What is happening with the Ashland Budget for 2017-2019?

Ashland Budget Committee Meeting –  May 11, 2017

On May 11th, the council chamber was filled with citizens. Many chose to speak on various issues. Some spoke to the need for a new employee to oversee the Climate Environmental Action Plan (CEAP). Others asked questions regarding the budget and its process.

Interim finance director Bev Adams described several critical factors constraining Ashland’s city budget:

  • The current budget reflects a 19.1% increase from the last biennium, an increase of $46 million.
  • Public Employees Retirement System (PERS):
    • The budget reflects a 20.4 % increase in PERS expenses, or $2.2 million.
    • $1.76 million of the $2.2 million is a statewide mandated liability.
    • $450,000 of the $2.2 is an increase in employee PERS.

Increased City Healthcare Costs (the city is self insured):

  • The City has an outstanding internal loan of $525,000 to meet this expense.
  • Currently, claims are exceeding premiums, dictating an 18% increase in the city’s healthcare budget.

Warning:  Ashland should expect an increase in PERS of at least $2.2 million every budget cycle for the foreseeable future.  Consequently, Ashland’s financial state is fragile. The usual $1.2 million reserve is currently down to $25,000.  Much of that reserve was spent on the City’s self-insured healthcare.

  • The budget reflects a 9.4% increase in personnel/benefits
  • All the utility rate increases are reflected as revenue in the current budget, even though the electricity increase has yet to be approved by the City Council.

Each departmental service under City administration was reviewed briefly by the committee. Parks & Rec also presented a budget but not without serious questions to be answered.

With the challenge of PERS and the increase in the City’s personnel/benefit expense, committee members asked to be shown detail on each City administrative salary.  At issue is the 20.4% increase in the PERS expense and how the budget addresses this $2.2 million increase.  Staff strongly objected to sharing this data, and the request was tabled.

The next meeting will be held on Thursday, May 18, 6:00 pm in the Council Chamber. One issue to be addressed will be the added $500,000+ cost per year resulting from the addition of five police officers which Council has approved. There is no revenue stream to pay for this additional expense. The $5/month surcharge on citizens’ utility bills remains the only viable pay-for; no other proposal has emerged.

Attend the next meeting of the budget committee – this is serious!!

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//inserted by Sharon