Tax hike, numerous cuts not enough to close gap in Verona's proposed 2022 budget

A nearly 26% tax hike, as well as cuts to engineering, consulting, legal services, no paving and not hiring another full-time police officer, still does not make up for a deficit in Verona’s proposed budget.

Next year’s spending plan does not look good for borough officials or residents as elected leaders spent more than three hours Nov. 23 brainstorming ideas on how to close an estimated $370,000 shortfall.

“Any way you slice it we need to raise taxes,” council President Nancy Carpenter said after the budget workshop. “It’s all about priorities.”

Projected revenues were listed at about $1.68 million and expenses were about $2 million, an estimated $320,000 gap.

The borough started its 2022 planning a little more than $51,000 in the red, according to draft budget documents.

“This is a hard conversation,” borough Secretary Christine DeRunk said. “When we start trimming things, we need to be conscious of what we’re really trimming. The budget is already very lean. When we start making cuts these are cuts in operations. We need to discuss what’s important (and) what level of service do we want to provide.”

One of the ways to close the gap was a 2-mill tax hike.

The current tax rate is 7.8 mills. The borough has not raised real estate taxes in at least 10 years.

The median assessed home in Verona is a little more than $50,000. Meaning the hike, should it be approved next month, would increase that property owner’s real estate tax bill by about $101.

One mill generates about $100,000 for the borough. Officials would still need to cut about $70,000 with the proposed tax hike.

All council members in attendance said they were opposed to the idea, but admitted there are little to no other options.

“I still think it’s really hard for families to take that on,” said Councilwoman Trish Hredzak-Showalter.

Some of the cuts proposed included $9,000 for a convention at Seven Springs, $3,000 in consulting fees, $4,500 in both legal and engineering fees by not calling the solicitor and engineer as much, $1,200 in public works overtime by not watering flower baskets and scaling back a $100,000 payment to the sewer fund to $55,000. No money for paving is listed in the general fund.

Council also discussed not hiring a full-time police officer to save another $75,000.

Another full-timer is something Mayor David Ricupero has requested for years.

Ricupero said he would at least like to hire a part-timer to offset overtime and have more manpower for certain shifts. That cost was estimated at $24,000.

Other police talk included an estimated $10,000 in bonuses. Council approved more than a year ago a $2,000 bonus for officers who worked an average of 32 hours per week for a full year.

Ricupero lobbied for a longtime officer with more than a decade of service be able to earn something despite not reaching that threshold.

Council discussed doubling borough parking tickets from $5 to $10 as a means to increase revenue. That is projected to bring in $2,000.

About 15 capital improvement projects including a public dock upgrades, crosswalk upgrades along Allegheny River Boulevard, borough building roof replacement and a salt shed were briefly discussed with none making it into the budget.

The borough is would be a little more than $12,000 in the hole even with the proposed hike, cuts, revenue considerations and no emergency reserve fund.

DeRunk noted Verona did not suffer a loss of revenue due to the pandemic, so it cannot use American Rescue Plan Act funds to close the gap.

One of the reasons the borough is in such a financial hole is council pulled from its sewer fund the past several years for general purposes, which council Vice President Dave Matlin said is against borough code.

He said sewer fund monies were acquired from the Oakmont Water Authority and were to be set aside for sewer repairs and maintenance. Instead, Verona borrowed from itself about $550,000.

Matlin said the error was not discovered until earlier this year when Verona changed bookkeeping services.

There is no deadline to pay the money back or means to cover a major sewage problem should one occur.

Matlin said he expects the aforementioned numbers to change as the budget process goes on.

No votes were taken Nov. 23. Council’s next meeting was to be a workshop 7 p.m. Nov. 30.

A draft of the budget is posted on the borough’s website, veronaborough.org.

The final budget is expected to be on display starting Dec. 2 and voted on Dec. 14.