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Did You Know? The City first had a Mayor-Council form of government that was established in 1898 |
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| Departments : Finance and Administration : FY 2003 Budget | |||||||
The Honorable Mayor and City Council Citizens of Gaithersburg I am pleased to submit the City Budget for Fiscal Year 2003. This budget allocates the resources necessary to implement the majority of our Strategic Direction initiatives as refined annually by the Mayor and City Council. Considerable effort has once again been made to prioritize our expenditures in line with the Strategic Plan, in order to deliver the highest possible value from our revenues. Those elements of the current adopted plan not funded in this budget are being studied for implementation in the coming years. For the 38th consecutive year, the City's budget can be funded without a tax rate increase. Once again we propose to adopt a real property tax rate of $.212 per $100 of assessed value. Additionally, the ad valorem tax on tangible personal property would remain at the rate of $.53 per $100 of assessed value. This budget continues our policy of maintaining a constant tax rate and our "pay as you go" philosophy relative to our City's finances. The Operating Budget grew at a slower pace than in recent years and the Capital Budget experienced a second consecutive decrease in anticipation of major expenditures planned for the Fiscal Years 2004 through 2006. The budget also reflects an overall reduction in state and county funding of capital projects. In brief, the City Operating Budget has grown by $960,162 and is $26,406,806, a 3.8 percent increase over the previous year. This increase reflects the normal growth of expenses associated with City personnel and the provision of City services, as well as a number of new, priority initiatives. The City's Capital Budget decreased by $3,584,239 and is now $4,444,911, a 44.6 percent reduction. Reappropriation of excess revenue and unexpended operating funds is $3,574,172, which assists in the funding of the FY 2003 Budget. This is $156,442 less in reappropriation compared to the FY 2002 Budget. These additional funds are (as they were in FY 2002) substantially attributed to a specific Capital Improvement Project - Lakelands Park. Approximately $836,550 of escrowed monies from developers is being used to fund various Capital Improvement Projects, as compared to $309,000 in FY 2002. Staff continuously strives to obtain the best available economic data relating to our revenues and expenditures. It has been clear for some time that, at current levels, the spending plans anticipated as recently as two to three years ago would have to be re-examined. We feel that this budget allows us to keep an acceptable level of reserves, maintain a consistent tax rate, and avoid debt, while still providing a high level of core services and adding major Capital Improvement Projects. Funding of the construction and subsequent staffing and operations of new facilities, including Lakelands Park, Lakelands Recreation Center and the Gaithersburg Youth Center, is the single greatest fiscal challenge facing the City in the coming years. Careful evaluation of all current and potential revenue sources must take place prior to the FY 2004 Budget process. A combination of economic forces, an expected reduction in building and development fees, and historically low interest rates have resulted in an actual reduction in forecasted revenues for FY 2003. Staff had already begun to identify these trends and implemented cost-saving measures during FY 2002. Gaithersburg's real property and income tax bases remain strong and are expected to grow in the coming year. Other revenues received, including shared taxes, licenses and permits, and charges for services, are growing at a lesser rate than in previous years. Development-related fees and revenues from interest on the investment of City funds will be substantially less than the previous year. We continue to balance realistic revenue goals in our decision-making processes. For FY 2003, we project an 8.3 percent decrease in overall revenues, as compared to a 5.8 percent increase for FY 2002. Some of this decrease is attributable to the reduction in state funding for capital projects. We were pleased in FY 2001 to receive grant funds from federal, state and county sources for the proposed Judy Center, Olde Towne initiatives, public safety, recreation, education and the arts. We will continue to pursue additional grant fundings for as many City programs as possible, and have proposed that additional staffing (described below) be utilized to further develop this increasingly-important source of funds.  The City's Operating Budget increased 3.8 percent over last year's budget. This increase funds new initiatives (outlined below), provides adequate funds to compensate employees fairly, and provides for contingencies for unexpected expenditures. Although many departments requested additional personnel, no new full-time positions are included in this budget. It should be noted that a number of positions were added mid-year in FY 2002 to provide necessary services. These included a Facilities Operations Specialist (supporting both the Kentlands Mansion and the Arts Barn), an Accounting Technician (upgraded from employment agreement), a Recreation Technician, and a Planner (upgraded from part-time to full-time).Personnel With the expected opening of the Arts Barn in the spring of 2002, support staff included in the FY 2002 budget, but who were not hired, will be brought on soon. These part-time positions include an Arts Program Coordinator and three part-time Receptionists. Several positions were downgraded or eliminated from the budget for the coming year. These include the Business Systems Analyst (from full-time to employment agreement), a Permit Analyst (eliminated), and Recreation Staff Assistant (from full-time to part-time). Other Initiatives Enhancements to the Parks, Recreation and Culture budget include transfers of positions in Administrations, Recreation Programs, Youth Services, and Special Events. These changes will result in cost savings and in better allocation of staff resources. Activities undergoing major revisions include Recreation Programs due to the elimination of the Basketball Exchange Program, National Junior Tennis League, and Baseball Clinic. Additionally, several adult sports programs have been restructured. A number of significant changes appear within the Public Works, Parks Maintenance and Engineering Department budget. Utility costs continue to rise dramatically and alternative purchase options are being explored and conservation measures taken. Costs relating to privatization of the yard waste program, as well as an increase in the recycling contract exceeded $80,000. Additional City facilities have been added to the security contract, which will result in increased costs. The Planning & Code Administration will conclude the Master Plan process in FY 2003. Printing and binding of the plan are budgeted at $15,650. Staffing change includes the upgrade of a part-time Planner position to full-time. In FY 2003, the Police Department will commence implementation of the Mobile Data Terminal (MDT) program. The MDT's will allow City officers upgraded access to records and state-of-the-art call dispatching capabilities. Replacement funds for MDT's, police radios and vehicles have necessarily increased ($137,000) in order to keep pace with the higher cost of replacing the more advanced equipment. The Information Technology Department, in addition to assisting the police in the implementation of the MDT's, will begin a pilot document management program. Document management will allow for easier storage and retrieval of appropriate documents. In Olde Towne, staff has been working with the Olde Towne Advisory Committee to explore the feasibility of a clock tower and plaza at Olde Towne Park. A preliminary design for the tower, as well as restoration of the historic clock purchased by the City in 1998, are scheduled to occur in FY 2003. A sidewalk project along West Diamond Avenue, funded through a Smart Growth Transit Grant, will also be completed. CAPITAL IMPROVEMENT PROJECTS
CONCLUSION
Finally, I would like to express my appreciation to those citizens who participated in the Budget Forum, all the staff who assisted in the preparation of this budget, and to the Mayor and City Council and the community as we continue to make Gaithersburg a great place to live, work, learn, and play while maintaining the City's strong financial position. Sincerely, |
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The Gaithersburg Arts Barn opened in the spring of 2002. A full complement of staff is currently being hired. FY 2003 will be the first year the Barn will have a full operating budget. The operation of the Barn will be monitored closely to identify programs that provide revenue offsets while maintaining the facility's programmatic goals.
Lakelands Recreation Center is by far the largest capital project facing the City in the coming years. The estimated cost of the project now approaches $10 million. As indicated previously, numerous other CIP initiatives were rescheduled or eliminated in order to provide funding for this project. Additionally, the FY 1999 to FY 2002 budgets were artificially high due to extraordinary contributions from the county and state.