Garden CityBudget News By Roy S. Ryniker

The Village's budget for the current fiscal year is $53.7 million. Beyond each resident knowing their contribution towards that budget and assessing what services they receive, residents need benchmarks to compare the budget against. Budgets need to be analyzed by examining the service levels provided and their associated costs, by examining trends in those service levels and costs, and also by benchmarking the budget relative to the budgets of similar communities. Rockville Centre is such a community. Below is a review of current budgets for Garden City and Rockville Centre.

Garden CityRockville Centre

Legal StructureInc. VillageInc. Village

Population21,67224,568

Square Miles5.33.3

Median Family

Income (1999 dollars)$120,305$103,315

Total Housing Units7,5559,419

No. Single Family -

Owner Occ. Homes6,0435,420

Total

Expenditures$53,703,458$33,253,226

Per Capita$2,478$1,353

Sources of Revenue:

Tax Levy$41,301,210(76.9%)$19,529,998(58.7%)

Existing Surplus$5,084,090(9.5%)$150,000(0.5%)

Other Funding

Sources $7,318,158(13.6%)$13,573,228(40.8%)

Total Revenues$53,703,458(100.0)$33,253,226(100.0)

Rockville Centre has 3,000 more residents than Garden City, however, it has less single family owner occupied homes as more residents life in multi-family homes. More residents in Rockville Centre would indicate the need for greater expenditures for Village services; however, those residents life in less square miles (less roads to maintain) and in more multi-family homes which should lower the costs of providing certain services, such as trash collection.

Why does Rockville Centre, with 3,000 more residents than Garden City, have a Village budget $20.5 million less than Garden City? For budgeted village expenditures, Garden City's per capita spending is 83% higher than that paid by Rockville Centre residents.

What Our Village Budget Includes - the Garden City budget includes $3.3 million for funding the Library and $3.5 million for capital projects. Rockville Centre funds these expenditures outside of the primary village budget. Rockville Centre receives $3 million in net revenue from its owned electric utility and also has $0.6 million in higher debt service payments than Garden City. After making these four adjustments in an attempt in ensure comparability and analyze operating expenses, the Garden City budget is $11.3 million higher than Rockville Centre's.

Service Levels - Garden City has a combination Fire Department (36 full-time staff supplemented by volunteers) while the Rockville Centre Fire Department is all-volunteer. The incremental cost of this service to Garden City residents is approximately $5 million per year. The Police Departments of both Villages have approximately the same budget ($8 million excluding employee benefits) and staffing levels, however, Garden City has 3,000 fewer residents.

Head Count - Garden City has 317 employees, Rockville Centre 176. Garden City's head count of 141 more staff than Rockville Centre is partially due to counting more services in the Village budget such as full-time Fire Department staff; this is partially offset by some of the Rockville Centre staff that are on the Village's payroll but do work for the separate electric utility that is owned by the Village.

Outsourcing - Rockville Centre's headcount is also lower due to their outsourcing of 100% of grass cutting services at the Village's parks. They initiated the outsourcing of these services in the early 1990's as a cost saving measure. Garden City outsources less than one-third of its park maintenance, with the balance of the services provided by full-time Village staff.

Fiscal Policy on Funding Expenditures - The two villages have significantly different policies towards funding their expenditures. As noted above, for the current fiscal year, Garden City relies on tax levies for 77% of its revenue sources compared to 59% for Rockville Centre. Rockville Centre can do this because of their higher reliance on Other Funding Sources of $13.6 million. Excluding the $3 million of revenue they receive from the Village's owned electric utility; Rockville Centre still has $10 million in Other Funding Sources compared with $7.3 million for Garden City.

Fiscal Policy on Capital Projects - The two villages' policies towards funding capital projects, in the range of $3 million to $4 million annually, are significantly different. Garden City generally funds capital projects out of general revenues (primarily tax revenues) and issues bonds occasionally for special projects. Rockville Centre annually issues bonds to fund capital projects and funds the debt service requirements on those bonds from general revenues. What's the difference? The Garden City fiscal policy is a "Tax Now" concept, have current taxes fund capital projects; Rockville Centre's is a "Borrow Now" fiscal policy, and have the debt repayments in later years funded with taxes or other revenue sources. Budgeted debt service this year is $1.9 million for Garden City and $2.5 million for Rockville Centre. This debt service funding requirement is in addition to Garden City's annual capital expenditures paid with current tax revenues.

Why benchmark?

Identifying the pros and cons of the differences in spending, service levels and fiscal policies between Garden City and other villages contributes towards the development of a set of Best Practices upon which to judge the services provided to Garden City residents and what the appropriate costs should be for providing the desired service levels.

Roy S. Ryniker is President of the Reorganization Alternatives Group, Ltd. and is Chairman of the Garden City Citizens' Budget Review Committee. He can be contacted at Roy.Ryniker@ReAltGroup.com