The hypocrisy is breathtaking.
Two governing body members, Mayor Chris Morrow and Councilman Steve Shute, very deliberately campaigned that Gardner tax reserves are too high.
The city’s current reserve rates will be about 38 percent of annual expenditures by the end of 2014. Barring a major catastrophe like an asteroid hitting city hall, the reserves are more than sufficient. Best practices indicate that Gardner’s reserves should be no less than 16.6 percent.
Despite the city’s dramatic savings account, err, slush fund, Larry Fotovich was the only council member advocating for lower taxes.
Council members spent the first minutes of the budget discussion explaining a decision to take money from the Electric Utility Board overcharged the city about $219,000 for electric rates over a 2-year period.
The EUB’s board members are appointed by the city council and have a budget separate from the city’s. The EUB operates as a business and revenue comes primarily from ratepayers; city staff prepare bills and the council believes the EUB should refund overcharges.
Council members said that the EUB, with reserves of 21 percent of annual operating expenses, could afford to refund the city for overcharges. According to best utility practices, the utility should carry a reserve balance of at least 11.5 percent of operating expenses.
Meanwhile the city of Gardner is holding reserves far beyond exceeded best practices. This year’s ending balance will hold 38 percent in city reserves – 20 above and beyond the minimum established by consultants and experts.
The citizens of Gardner were obviously overcharged. Where’s our refund?
But despite the campaign rhetoric, at the Aug. 5 meeting all but Fotovich agreed that taxes could not be lowered. One said it would create instability to lower taxes one year and raise them the next. Another said the budget process was too short to have time to consider a tax decrease.
We don’t remember a time the council ever lowered taxes, so we’re not sure what the claim of “instability” is based on. And the budget is due every single year at the same time. This process, while slightly different from previous years, did not come as a surprise.
We imagine most residents would enjoy a brief respite from high taxes, if offered the opportunity.
Clearly the city council is not seriously looking at cutting taxes or reigning in expenses, even in light of high reserves and an increased property valuation of about 1 percent, which also provides additional revenue for city coffers.
Also confusing in the meeting was Shute’s statement that taxes can’t be lowered until the city’s tax base is broadened, while in the next breathe saying he is not in favor of tax abatements.
The city rarely turns down an opportunity to offer an abatement or tax incentives to large developers. The reserves are likely to be sacrificed on the altar of growth.
If you read the city’s abatement policy you’ll see incentive loopholes providing for much more than a 50 percent abatement, and nowhere do we find any clawback provisions if developers don’t employ local people at a quality wage.
Having that money sitting aside is too big of a temptation. It will be spent, and probably on a number of things that are more wants than needs. That’s not hyperbole. That’s human nature.
When was the last time the citizens received a tax decrease? Better yet, when was the last time anyone anywhere received a tax decrease that comes near the rate of increase Gardner received in 2011, of approximately 30 percent?
The answer is never. It doesn’t happen. Governments are a black hole with an endless need for more of your dollars.
Our biggest disappointment is that we believed the campaign promises to cut spending and lower taxes. Next year’s budget increases spending – some of it with one-time, necessary infrastructure projects – and much of it – with permanent, ongoing expenditures like adding 10 new employees.
Not once did anyone say existing staff was overworked. Instead the additions are to staffup for anticipated future growth, despite the budget repeatedly indicating Gardner isn’t growing. Why do we need 10 new employees?
Wouldn’t the additional revenue be better used in a one-time expenditures to do delayed infrastructure maintenance such as paving roads and updating sewer lines, and permanent tax breaks for citizens and businesses? Some maintenance projects have been delayed since 2005, and taxes has been too high for even longer.
The council needs to quit searching for the pot of gold at the end of the “growth rainbow” and focus on maintaining Gardner’s existing infrastructure and quality of life, while operating in an efficient and financially conservative manner.
To do other wise is disgraceful.