Heels of levy failure
Council begins to define core, enhancements
Gahanna City Council's finance committee added a five-year plan to its agenda May 13 as a result of last week's defeat of a proposed city income-tax rate increase from 1.5 to 2.5 percent.
Finance committee chairman Brian Larick said he wants to get a clear understanding of the finances and set a timeline concerning adjustments that need to be made to the city's budget.
Finance director Jennifer Teal said she would like to have council approve the 2014 budget by July 1 so she could provide a copy to the state.
The administration will work on a plan for suggested cuts and adjustments to the budget that will be presented to the entire council June 24.
Revenue from the proposed income-tax rate increase would have generated about $8 million annually, which is the same as the city's projected deficit.
Mayor Becky Stinchcomb said she and city directors cleared their calendars last Thursday and Friday to begin initial conversations about the levy defeat and the next step.
"There are a lot of mixed feelings," Stinchcomb said. "There has been a lot of input. It's all across the board. One of the hallmarks (in Gahanna) is to make careful, well-thought-out decisions and not knee-jerk. I have no desire to change that."
She said cuts this year are likely, though.
"As we said from the beginning, the tax reform was about 2014 and beyond for the future sustainability of the city," Stinchcomb said. "Budgeting is a yearlong process, and it has been since 2008. What's being requested from council is more detailed than before."
Teal defined it as activity-based costing, and council president Stephen Renner called it performance budgeting.
"What we've done in the past is look at specific programs, services we offer," Stinchcomb said. "What's the cost to provide that? Now you want a more detailed look at that. ...
"It's more of a business model we're moving to. We're going to take this to the next step," she said. "We understand timing is critical. We need to do a better job of informing the public of what things really cost."
Moving into the appropriations this fall, Stinchcomb said, the city needs to determine what is and isn't going to be offered.
"Some activities bring in revenue, and some things we do, like the senior center, is almost a pure cost," she said. "Our seniors pay a minimal fee. One exercise we did a couple years ago is that we went through a detailed exercise of our core functions, our enhancements. We divided our services and activities into those categories."
Stinchcomb said that's a good tool -- to determine what's core as a government and what true enhancement is.
"Do we want to be core basic services or have enhancements, and what do we consider that to be?" she said. "We need to do a five-year outlook and need a needs assessment."
With the failure of the income-tax increase, Stinchcomb said, she views everything in the previous needs assessment as being unfunded.
"When you talk about the state budget, capital is determined as anything over $5,000," she said. "What we've been doing the last couple years is, if it's a regular expense, it shouldn't use a one-time payment."
Stinchcomb said items like road paving and cruiser replacement always would be needed and should be considered ongoing costs. She said police are essential.
"We were at 60 and budgeted for 55," she said. "We're down to 49 today due to retirements, and one died. They're important and expensive employees. We think it's core."
Stinchcomb said staffing decisions would be made when council and the public decide what services they want.
"As I've thought about this, the expectation, from my perspective, is ongoing target expenses don't exceed ongoing revenue, with the exception that carry-over in all likelihood could be used for single, one-time capital expenses," Larick said.
He said it isn't just about cuts but, from an administrative standpoint, also reviewing the structure and how pieces fit together and changing how things are done.