Ellsworth’s Budgeting Process Print E-mail
Thursday, May 04, 2006

If ever there were a time for Ellsworth city officials to engage in some long-term planning, that time is now. Councilors were rightly alarmed last week when confronted by a budget proposal from City Manager Stephen Gunty calling for a 21 percent increase in spending for the next fiscal year. That increase, were it to take effect, would up Ellsworth’s total budget to $12,324,522.

Realistically, there’s no chance at all that this first budget proposal will survive. But even with some $900,000 in possible cuts identified by the city manager, Ellsworth would still be looking at a 10 percent spending increase over the $10,201,990 budgeted for this year.

And there may be a great big kicker waiting in the wings. A revaluation of all city property currently is under way, with completion scheduled for mid-August. Officials are expecting the total valuation to increase by almost 50 percent, from today’s $581,572,250 to approximately $876,795,000. That likely will mean a dramatic reduction in the state education subsidy, even under the state’s revamped policy for funding education. Further, the likelihood is that valuations will only continue to increase, bringing further reductions in subsidy even as Ellsworth’s school enrollment remains at current levels or grows.

The combination of the next city budget, whatever it may be, and the higher valuations, especially of waterfront property and newer construction, will mean whopping tax bill increases for many payers.

While continued business and residential growth in Ellsworth clearly will bring increased tax revenue, it will not happen quickly enough or in large enough increments to offset the rising costs the city will face in coming years just to maintain the level of public services it has now.

Ellsworth residents are no different from residents of communites large and small across the nation. Over decades, all of us have become more and more accustomed to more and more governmental services — police and fire protection, schools, water and sewer systems, roads and highways, recreation and public assistance programs among them. In almost every case, these services become more, rather than less, expensive with each passing year.

Not surprisingly, town and city officials come up with what they consider maximum target tax rates for their communities every year, and “same as last year” is often the demand they hear from voters at town or council meetings. But such targets, while undoubtedly more palatable to voters, aren’t realistic without a corresponding willingness to reduce or eliminate public services.

Ask the city manager or any councilor and you can easily get a laundry list of needs that will face the city tomorrow and further into the future. Those needs aren’t going to go away even if they’re ignored for a time. So it is essential that city officials develop a plan that includes hard numbers for both anticipated ongoing expenditures and capital reserve budgeting for major purchases and projects. Officials then must mount an aggressive informational campaign that clearly identifies those future needs and, as best they can, how they propose the city should meet them.

Public officials and voters alike must realize that, even with their best efforts, uncertainties will remain, especially on the revenue side, given changes in state and federal funding policies that directly affect municipalities.

In the end, voters still may not accept local spending proposals. But with adequate planning, future decisions at least could be made on an informed basis, with taxpayers understanding what they may have to give up in order to hold an acceptable line on taxes.

The alternative — to muddle along budget by budget — is to live from crisis to crisis, and that is unacceptable.

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