Garden City Budget News
By Roy S. Ryniker

How Much Spent? Funded How? Spent on What?

The Village budget for the upcoming fiscal year is $53.7 million. How does it get funded?

Funding Sources: ($ millions)

Tax Levy$41.3

Existing Surplus 5.1

Other Revenues 7.3

Total Funding Sources$53.7

Tax Levy - the real estate assessment roll has two main groups: (1.) Owners of single family dwellings, apartments and condominiums comprise 80% of the real estate assessment, up from 71% ten years ago; and (2.) Owners of commercial properties, golf courses, hotel and utilities and special franchise properties comprise 20% of the real estate assessment. Residential owners are paying an increasing percentage of an increasing tax levy. The Tax Levy steadily increased from $27 million in 1994-95 to $35 million in 2002-03 to the current $41.3 million.

Existing Surplus - generally unspent funds that the Village had accumulated from earlier years.

Other Revenues - assorted revenues that the Village projects collecting during the year. The largest revenue sources are: mortgage recording taxes ($1.5 million), interest on Village cash investments ($915,000), fines and penalties paid through Justice Court ($900,000), non-property taxes such as county sales tax, cable TV franchise fee, public utilities gross receipts tax ($878,000), and fees paid to Village departments such as building, electrical and sidewalk inspections ($655,700).

What are the funds spent on?

To analyze and manage the Village's expenses, one has to examine the largest expense category, labor, as the Village employs approximately 317 full-time employees. Total personnel costs (salaries, retirement, social security and employee benefits) total approximately 70% of total operating expenses, including the personnel costs portion of the $3.3 million funding for the Library. What are the significant factors impacting personnel costs:

* Village's work force is approximately 95% unionized (civil service, police and fire).

* The new budget has total personnel costs of almost $34 million (including the Library portion of the Village budget).

* From 2002 to 2006, total employee benefits increased 105%, from $3.8 million to $7.7 million. Total employee benefits are budgeted at $8.6 million in the current budget, an average of $27,000 per Village worker.

* The employee benefits portion for health and dental insurance costs in the current budget are $4.5 million. That totals approximately $14,000 per employee.

* The Villages contributions to the employee retirement systems rose 183% over two years: from $983,090 in 2004 to $2,783,275 in 2006.

* In 2006, the Village paid $914,314 for health insurance coverage on behalf of 165 retirees.

Beyond compensation costs, some of the Village's primary budgeted expenditures are:

1. Capital projects - $3.5 million (equipment for police, fire, public works and recreation departments, technology upgrades, etc.).

2. Insurance Reserve - $2.7 million

3. Refuse disposal costs - $2.0 million

4. Debt service - $1.9 million

5. General Supplies - $1.4 million

The Village has three Enterprise Funds - Swimming Pool, Indoor Tennis, and the Water Department. These entities raise their own revenues and have there own budgets separate and distinct from the Village Budget of $53.7 million. The Library has its own budget; however, the Village's contribution to the Library for the current budget is $3.3 million.

The above data was excerpted and calculated from (1) the Village's Comprehensive Annual Financial Report for the Year Ended May 31, 2006 and (2) 2007-08 Village Budget.

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