Board of Supervisor Minutes
November 9, 2005
MINUTES WERE APPROVED at the regular meeting December 14, 2005. MINUTES OF 11/09/05 REGULAR MEETING: Mr. Jirele moved to approve the minutes of the regular meeting of November 9, 2005. Mrs. Goren seconded and the motion passed unanimously.
The Newtown Township Board of Supervisors met on Wednesday, November 9, 2005 in the Township meeting room at 6:00 PM. In attendance were Supervisors: Chairman Richard Weaver, Vice-Chairman Scott R. Harp, Secretary/Treasurer Anne Goren, and Members Raymond Goodnoe and Thomas Jirele. Also in attendance were Township Manager Robert Pellegrino and Finance Director Elaine Gibbs.
Department Heads/Personnel Present: William Wert, Parks and Recreation; Don Harris, Emergency Services; Chief Martin Duffy, Police Department; Ronald Weaver, Technology; Thomas Harwood, Codes and Public Works.
Call to Order: Chairman Richard Weaver called the regular meeting to order at 6:00 PM. He said that Mr. Pellegrino would present the 2006 budget followed by questions from the Board and public comment.
Mr. Pellegrino explained that the proposed 2006 budget has been prepared in accordance with DCED Chart of Accounts. The budget maintains municipal services at current levels; no expansion of Township organization is anticipated, although there could be need for additional public works personnel at some point in the future, The current tax rate of 2.625 mils, about $125 to the average assessment, is maintained. This proposed budget is a balanced budget.
The funds are divided as follows:
General Fund revenue comes from a variety of sources. The earned income tax generates 57% of the total revenue, 4.7 million dollars in 2005. There has been some leveling off of this revenue from previous years, particularly in non-resident earned income tax, as other municipalities enact the tax. There was an increase in revenue of about 4.2%, due in part by an improved economy, new residents and increase in non-resident workforce. This revenue is projected to be over $5 million dollars in 2006, a 6.8% increase.
Permit and development fees continue to generate revenue for the Zoning and Code Enforcement Department. Although there was some slowing in 2005, it is expected to increase in 2006, based on projected development, particularly in non-residential development, including Newtown Corporate Center, Penns Terrace, Hilton Gardens Hotel and Conference Center. There are 800,000 square feet of new non-residential development. There is also an expected increase in residential development in 2006, including Lafayette Quarters, Foxhall Estates, and the Fidler/Roberts and Goodnoe tracts.
Other steady sources of income include business licenses and permits, pension system state aid, police fines and employee contributions to benefits. Grant income from recycling performance, pension system state aid and DARE are expected to total about the same as in 2005, which was $243,000.
Income from intergovernmental agreements with Newtown Borough for fire inspections and with Wrightstown Township for police services will generate income that offsets expenses.
Interest earnings were up this year, and that trend is expected to continue.
The 2006 revenues are estimated to be $8,779,200, a 13.7% increase over 2005 budget.
The Finance Committee has recommended a few programs to generate income:
General Fund Expenditures
The total 2005 expenditures are projected at $8,510,000, or $65,000 over budget. Additional funds have been needed for the Sycamore Street project.
The total proposed appropriation for operations in 2006 is $8,761,800, an increase of 10.5% over 2005. The additional appropriations include increased cost for:
Expenditures include purchase of three police vehicles and computer systems.
Mr. Pellegrino provided a handout detailing the operating appropriations. He noted that Salaries and benefits make up 70.4% of the budget; when professional services, contracted services, insurance and utilities are added in, they make up 85.7% of the budget.
The total expenditures, with interfund transfers, are budgeted at $9,703,800. Interfund transfers include $900,000 to the capital projects fund and $42,000 in additional support for the rescue squad. The 2005 beginning fund balance was $2,978,976 and is projected to decrease to $1,856,000 with these transfers. This is consistent with the reserve policy adopted by the Board in 2003.
Mr. Pellegrino noted that looking forward there is some expansion in the non-residential sector, which will boost tax revenue. Some residential growth is also expected. The Township Administration will explore possible cost savings in alternatives to present medical and liability insurance. The Township will continue multi-year budget forecasting with the Financial Planning Committee. The Township will continue to pursue acquisition of the Archdiocese property. Decisions should be made on the most appropriate use of the RCN settlement and on the municipal complex expansion.
Street Light Fund
There are 1457 streetlights, with new lights added as developments are dedicated. There is $6,000 budgeted for upgrades at a number of locations. There is a $205,000 balance from the elimination of the assessment.
Fire Protection Fund
Currently 0.875 mils are used to support the Newtown Fire Association; the Township will pay $267,000 to the Fire Association.
Rescue Squad Fund
The Rescue Squad is supported by a 0.125 mil tax, which will generate $38,000, and a General Fund contribution of $42,000 for a total of $80,000 support.
Park and Recreation Fund
The 0.75 mil levy ($227,000) currently supports recreation administration and park maintenance. Park and Recreation revenue is projected at $628,000 for 2005 ($14,000 over budget) with projected expenditures of $586,000 ($7,000 under budget). Recreation programs are operating at 91% self-sufficiency. Programs are expected to generate $410,000 in 2006, a 7.5% ($37,000) increase over the prior year. In 2006, park and recreation appropriations will be $626,000, an increase of $32,000 over 2005. If new park facilities come on line, there will be new maintenance expenses.
Debt Service Fund
Currently 0.875 mils ($265,000) are levied for debt service. At the end of 2005, the total debt will be $790,000. The only outstanding debt is for acquisition of open space at the Wiggins tract and Silver Lake Park. The Wiggins tract will be paid off in 2008.
If the Board moves forward with the municipal complex expansion, a 2-mil increase will be needed to support the debt payments on a new bond issue using a 25-year term.
Capital Projects Fund
This fund is used for capital expenditures, with revenue derived from General Fund transfers and grants. The 2005 expenditures included the Sycamore Street project, erosion control for Newtown Creek, a document imaging system, engineering for the road maintenance program, Mardot Village storm sewers and architectural fees for the municipal expansion. The erosion control was funded by a $380,000 State grant and Sycamore Street was funded 80% by a Federal grant.
Expenditures for 2006, requiring a $942,000 transfer from the General Fund, include:
Recreation Capital Fund
Dedicated to the construction of recreational facilities, this is funded by recreational impact fees. In 2005, $200,000 was collected. It is estimated that $1,000,000 will be collected in 2006. Projects for 2005 included Clark Nature Center improvements and field reconstruction at Chandler and Helen Randle Parks.
In 2006, expenditures, totaling $513,000, will include:
Transportation Service Area Funds
Revenues are from impact fees collected under Act 209. Funds are restricted to use in specific districts. The fund balance for 2005 is $620,000. $824,000 was collected in 2005, and we expect to collect $1,150,000 in new fees in 2006. In 2005, the only expenditure was for engineering of the Buck Road/By-Pass improvement. In 2006, appropriations are $100,000 for engineering associated with the improvement of the Newtown Yardley Road corridor as part of the State Transportation Improvement Program projected to be funded by PennDOT with construction scheduled for 2007.
Traffic System Capital Fund
Total appropriations for 2006 are $87,000 for engineering and installation of video detection units and conversion to LED bulbs at various locations.
Highway Aid Fund
The Township’s share of the State Liquid Fuels Tax Fund was $320,000 in 2005 and with new road dedication is expected to be $340,000 in 2006. In 2005 the fund was used for roadway maintenance, equipment acquisition, traffic signal expenses, street light electricity, road materials and road maintenance contracts. In 2006 $425,000 is proposed for roadway maintenance of Twining Bridge Road, including stormwater drainage, and Wrights Road and Winding Lane, for a total appropriation of $575,000.
There is approximately $5,300,000 in assets, invested by professional managers with oversight by the pension committee. While these funds suffered some losses during the recent recession, they are recovering. State aid contributions fund $287,000 of the required $622,000; $257,000 will be paid from the General Fund and $85,000 from employee contributions.
Mr. Pellegrino thanked Mrs. Gibbs, Ms. Russo, the department heads and the staff for all of the work that went into the preparation of this balanced budget. The Township is in good financial condition, has one of the lowest municipal tax rates in the County, and proposes no increase in taxes in the coming year.
Mr. Weaver expressed thanks to the Township Administration and staff for the work that has been done in preparing the budget. He was very pleased that Mr. Pellegrino has presented a balanced budget.
Mr. Harp joined in Mr. Weaver’s thanks to the Township Administration and staff. He said he is pleased that there has been no deficit spending, and with the exception of the voter approved increased fire tax, there has been no tax increase in eleven years. He said that he hoped that the Township would go forward with the engineering for the Woll tract, as the various sports organizations are eager to begin grant applications for fields.
Financial Planning Committee
Allen Fidler reported that the Financial Planning Committee had been formed a few years ago to review operating revenues over a five-year period and make recommendations. In 2004 a consultant reviewed the five-year revenue stream and looked for opportunities to supplement the erosion of the earned income tax. The Committee, on the advice of this consultant, has proposed renaming the Occupational Assessment Tax as an Emergency Service Tax, and increasing the tax to $20 per worker per year; initiating a contractors registration program; and a Fire Safety Resale Inspection program.
Mr. Fidler explained that the State has approved the renaming of the occupational assessment. This tax is currently split with Council Rock School District. With the renaming and increase of the tax, the school district would continue to collect $5.00 and the Township would retain the remaining $15.00 per person employed within the Township.
The Contractor Registration would cost $25.00 per contractor. This program would protect residents, as contractors would provide proof of insurance to the Township before they could perform work here.
Fire Marshal Don Harris provided a memo and sample inspection checklist to Board members. He said that this program is in use in other municipalities. Based on incidents in older homes, he said that many fires could be prevented if the inspection were to be performed and problems corrected. Of particular concern are wiring of finished basements, dryer vents in older townhomes and disconnected smoke alarm systems. There have also been some homes with attic trusses altered to provide storage areas. The inspection would provide new buyers with information about these fire hazards.
Mr. Jirele expressed concern about older, historic homes that were not built to conform to the current building code. Compliance could be a great burden to the seller.
In response to Mr. Jirele’s questions, Mr. Harris said that while historic homes would not be expected to be brought up to completely comply with today’s code, some things could be addressed very easily, such as replacement of flexible dryer vents and installation of battery powered smoke detectors. While rewiring would not be required, encasing of exposed wires would be.
In response to Mr. Jirele’s comments about sidewalk safety, Mr. Pellegrino said that this inspection would provide a means for monitoring sidewalk conditions. This provision could be removed from the checklist if the Supervisors have reservations about it.
Mr. Harris noted that New Hope, Wrightstown, and Upper Makefield all have this inspection. Both buyers and sellers are notified of any safety issues uncovered, and it is up to the buyers and sellers to work out who would make necessary repairs. A temporary certificate of occupancy could be issued. In response to Mr. Harp’s question, Mr. Harris said that this program is very common in the County and throughout the area.
Mr. Jirele expressed concern that this inspection process could become burdensome for both buyers and sellers, particularly of older homes.
Mr. Goodnoe expressed concern about government intrusion into private transactions. He questioned whether the staff could handle the projected 700 inspections per year, particularly if some inspections would require a return visit.
Mr. Harris assured the Board that the department could complete the inspections, which he said would only take about 30 minutes.
Board Member Comments
Mr. Jirele said that he would like to see the expected recreational impact fees of $1,000,000 set aside for specific projects.
Mr. Pellegrino said that he agreed with Mr. Jirele and he would look for direction from the Board on this.
Mr. Goodnoe expressed concern that the expected increase of 6.8% in earned income tax revenue was too optimistic. He would prefer a more conservative percentage used in calculations. He noted that the increases have not been consistent over the years, with an increase of 13.55% in 1999 to a decrease of 4% in 2003. He again said that he is not comfortable with such an optimistic projection of revenue. The Township will not continue to see the explosive growth it has in past years.
In response to Mrs. Goren’s question, Mr. Pellegrino said that Lower Southampton and Montgomery Townships have enacted earned income taxes recently. He does not know of any other Township planning to enact the tax in the next year. There has been growth that has added to the revenue base, including an increase in non-residential growth. He also noted that some residents of new homes had not lived in Newtown the entire year.
Resident Nancy Crescenzo referred to minutes of budget meetings from 2003 and 2004 and questioned the need for a Township naturalist. She also asked why the Park and Recreation Department is said to be only 91% self-sufficient when it had been 95% self-sufficient in previous years. She questioned whether this rate is really adequate.
Park and Recreation Director William Wert responded that reference to a 95% self-sufficiency rate was for a “year-to-date”, the percentage at the time the budget was prepared. By year’s end the department is expected to be 91% self-sufficient.
Mr. Weaver noted that the Park and Recreation Department has been charged to have a self-sufficiency rate of 85%. The Department has consistently improved that rate over the years. Mr. Pellegrino agreed that the rate has consistently been very good.
Mrs. Crescenzo said that she is concerned about the Clark Nature Center, and with budget items for its maintenance and improvement. She said that, as a representative of the Environmental Advisory Council, she has contacted Representative Steil about finding sources of free advice for this property. She said that the EAC members are experts on the environment and their input should be included in decisions on the property. She suggested forming a volunteer group of “Friends of the Clark Nature Center” who would work to restore and maintain the property.
Regarding the proposed fire inspection, she said that the fire department would be competing with private business to provide this service. She suggested that the Township should do a better job of informing the public that fire safety inspections are available at no charge through the fire department. She asked how fire safety is handled at the tent at Rosebank Winery. She asked what the fire department is doing about the fire alarm switch-off problem at Newtown Grant. She said that the proposed new revenue generating measures, including new taxes, would have a negative impact on senior citizens on fixed incomes. She said that long range planning should be done for building a community center. We should not build new parks when we do not maintain our old parks. There have been injuries of players on our fields.
Mr. Pellegrino said that the parks and fields are very well taken care of, and the sports organizations using the fields have been very happy with field conditions. He said that he does not want Mrs. Crescenzo giving the public the impression that the fields are in bad condition; this is not the case.
The meeting adjourned at 7:50 PM.
Respectfully Submitted: ____________________________________
Mary Donaldson, Recording Secretary
Minutes Approved as submitted __________ as corrected___________
Robert M. Pellegrino, Manager Richard Weaver, Chairman
Scott R. Harp, Vice-Chairman
Anne Goren, Secretary/Treasurer
Thomas Jirele, Member
Raymond Goodnoe, Member
Thomas Jirele, Member
Raymond Goodnoe, Member