Early look at Plum budget shows deficit
Plum Borough's 2013 preliminary budget has a nearly $1 million deficit.
“It is definitely preliminary,” said borough finance director Michael Whitico during a presentation last week to council's finance committee.
Whitico said anticipated expenditures in the spending plan are $11,852,634.
Revenue is projected at $10,886,502 resulting in a $966,132 deficit.
Whitico is projecting a $664 surplus in the 2012 budget that is $10.7 million.
The preliminary budget for 2013 is a 1 percent increase over the current spending plan.
The last borough real-estate tax increase was 1 mill in 2008.
The millage rate is 4.3. A mill generates about $1 million.
“We haven't been taxing our residents to death,” said Plum Manager Michael Thomas.
Thomas said the borough has been doing more with less.
Thomas said various budget cuts have been made in recent years, including the elimination of the dispatch center and earned income tax collection.
One employee remains to collect both the delinquent earned income and local service taxes.
Also, the number of borough employees has dropped from 72 in 2004 to 65.5 in 2012.
He also said the number of police officers and public works employees has decreased.
“We have cut everything to the bone,” Thomas said. “And we have the lowest taxes of municipalities of our size.”
On the flip side, Plum's population has increased by 2 percent in the past 10 years, and the borough has 5 percent more housing units, Thomas said.
Also, the borough is responsible for more road maintenance than it had been 20 years ago.
Thomas said if council decided to eliminate discretionary spending in the 2013 budget that includes a police officer hiring, capital projects, cameras and fencing at borough parks and employee education and training, the savings would translate to about $450,000.
Some of the hits to the preliminary budget include: a decrease in grant revenue from $64,372 in 2012 to a projected $2,800 in 2013; a projected 20 percent increase in fuel costs; and an estimated 7.5 percent increase in costs for health insurance coverage.
Thomas also has budgeted more money in 2013 to cover worker's compensation insurance for the volunteer firefighters in the four departments.
The borough paid $41,950 for the coverage in 2012.
Thomas has budgeted $83,000 for 2013 because of the fallout from a year-old state law that enables volunteer firefighters to collect benefits if they develop cancer after being exposed to carcinogens at fire scenes.
PennPRIME Insurance Trust has dropped worker's compensation coverage resulting in municipalities, including Plum, signing up for coverage through the State Workers' Insurance Fund at a higher cost because of a lack of private-insurer alternatives.
Plum's preliminary budget also calls for nearly doubling from 2012 to 2013 the amount of money transferred from the general fund to the dwindling fire fund that is projected to have a $20,000 balance at the end of the year.
The borough transferred $75,000 to the fund this year and has budgeted a $130,000 transfer next year.
Also, earlier this year, council discussed enacting in 2013 a $1-per-month fee per household for fire hydrant maintenance.
Thomas said the fee would generate about $135,000 a year for the fire fund.
Council has made no decision about a possible fire fee.
Additional meetings about the budget will be scheduled in the next couple of months.
Councilman Michael Dell who chairs the finance committee said he wants to look over more detailed budget numbers before making any decisions about the spending plan.
“This is the first pass (at the budget),” Dell said.
The borough is required to have a balanced budget by Dec. 31.
Karen Zapf is a staff writer for Trib Total Media. She can be reached at 412-856-7400, ext. 8753, or firstname.lastname@example.org.