Lorains Future and the City Income Tax

June 25, 2012

Overview of the Additional Income Tax

Reduction in funding from State and in Grant Reimbursement Expected operating shortfall for 2013 Over the last several years, substantial cuts have been made to maintain status quo As evident, the status quo has not been maintained; without .5% income tax increase, the quality of services will continue to diminish

State of the Parks

Lorain has 56 parks, which totals about 600 acres compared to Elyrias 14 parks, which total 350 acres (2008 figures) In 2010, the Parks and Recreation Department was moved into the Street Department Parks in disrepair and not maintained; overgrown grass and shrubbery create safety concerns Parks are important to community value and quality of life

Comparison of 2000 and Today

2000 Figures
Budget: $1,512,110 Employees: 21 fulltime employees* Management: 2 2012 Figures Budget: $324,009 Employees: 0 fulltime employees* Management: 0

State of the Roads

Currently, $1.5M is spent from OPWC funds for road maintenance Currently, a 5 year/$5 license plate fee is used for Oberlin Avenue According to the Citys Engineering Dept., at least $5M in roadway rehabilitation is needed each year to bring all roads to an acceptable level According to the Citys Engineering Dept., at least $35M would be needed to bring all roads to an acceptable level

Comparison of Lorain and Other Cities

Elyria
187 centerline miles Operating Budget: $2.39M Overall Budget: $2.93M About $12,801/mile

Lorain
236 centerline miles Operating Budget: $1.5M Overall Budget: $1.5M* About $6,356/mile
*Does not include Oberlin Ave license plate fee

Amherst
67 centerline miles Operating Budget: $1.08M Street Improvement (levy): about $1M annually Total Budget: $2.08M About $31,045/mile

State/County Cuts and Revenue Decreases

Estimated total of $230,000 in cuts from Real & Public Utility and Homestead & Rollback (resulting in the revaluing of real estate) Estimated $1.2M in cuts from Local Government Fund and Estate & Inheritance (State funds) Expiration of federal grants, which total approximately 1M in General Fund revenue

Impact of Overall Budget

With cuts from State and property valuation decrease, Lorain will lose about $1.4M For 2013, the estimated revenue will be about $26.4M For 2013, the estimated expenses will be about $28.4M These figures factor in the loss of federal grant revenue and expenditures The above results in an expected shortfall of $2M

Efficiencies and Cost Cutting

Restructuring of Engineering Dept. to provide more services to Utilities in lieu of outside consultants Restructuring of Community Development Department to remove replication of duties thereby delivering more dollars to the community Property Maintenance Triage Proposal with Health, Building and Community Development Regionalization and Collaboration with other governmental entities (i.e. wastewater, health, etc.)

Authorizing private contractors to cut high grass complaints for the first time ever, thereby freeing our employees to care for parks and roads

Future of the City

Concerns over the past 10 years of the conditions of the streets and conditions of parks The status quo of 10 years ago has not been maintained due to budget constraints With more cuts looming from the State and the end of grants, the quality of service will continue to decline The .5% ( of 1%) income tax proposal will cover the State shortfall and provide the ability to get things doneother options do not provide this ability We cant compete with our neighbors unless we do something NOW

The Plan for the Income Tax

The of 1% is not a cure all Overall, an estimated $5.3M/year will be generated Of the $5.3M, the funds will be used the following ways: Est. $2.6M for General Operating for Core Services Est. $1.6M for debt service on $20M/20yr bond for immediate roadwork in the next 2-3 years Est. $1 M to augment annual roadway program

Overall Picture
We cant cut our way out of our financial picture Due to state budget cuts and property devaluation, we face a $2M deficit in 2013 (this does not include loss of grant dollars) The .5% income tax is not a cure-all The City will be continue to be aggressive in finding efficiencies and stretching dollars The income tax will allow the City to cover the shortfall and provide much needed infrastructure improvements for the city If Lorain seeks a better future, we must invest in our community Its up to us

 of 1% Income Tax Presentation

June 25, 2012