MALONE — Franklin County will likely raise taxes 5 percent in 2014 but use 2 percent of what’s collected to improve its cash flow.
With allowable exemptions and credits factored in, legislators could meet the state-mandated 2-percent tax cap if they raise taxes 2.99 percent.
But that would leave only about $7,000 to use toward any unexpected expenses or budget-projection shortfalls next year.
To fatten the cushion, legislators reviewed a variety of options Wednesday and verbally agreed to raise taxes 5 percent and put whatever is left after expenses into the fund balance.
The 5-percent option will give the county enough money to operate the government and add about $305,000 to reserves.
A State Comptroller’s Office audit earlier this year criticized the county for spending down more than $11 million in fund balance between 2009 and 2013 and recommended the level be built back up.
The proposed budget also includes $45,000 to be put toward raises for certain non-union management employees who haven’t had a bump in pay for four years. During that time, the county’s largest union has seen pay increases each year of its contract.
The county is considering a 1-percent raise for the roughly 90 non-union people while the United Public Service Employee union is to get a 2-percent raise in 2014.
Legislators have yet to reach an agreement with the Sheriff’s Department union on a new deal, but a fact-finder is poised to step in to resolve the issue.
The offer on the table calls for 2-percent raises the first and second year and a 2.5-percent increase in the final year of the contract.
County Manager and Budget Officer Thomas Leitz said the non-union raises would be based on merit rather than across the board. The amounts will be set before the budget is officially adopted today at the regular County Legislature meeting.
The proposed budget is $103,623,666, an increase of 3.09 percent.
The tax levy, or amount to be raised by taxes, is $16,178,524, an increase of 8.76 percent. But legislators plan to lower that to 5 percent.
In the proposed budget, at an 8.76-percent tax-levy rate, the average increase for a home valued at $100,000 would have been $35.28. But at 5 percent, the tax increase would be more like an average of $21.25 on the same home.
Legislators have agreed to override the tax cap after holding the required public hearings.
To lower the budget, the county is using $1.25 million from its retirement-stabilization account, which it may decide to pay back through a loan at 3.75-percent interest across 12 years.
Also, the expense to municipalities for holding their elections will be charged back to them at 100 percent of the actual cost rather than at 75 percent. So the towns and villages will pay a total of $532,200 in 2014, up from $402,200.
The county had been picking up the added expense for years but decided to spread the full financial responsibility to the municipalities.
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