HomeMy WebLinkAbout09-26-11 Public input on proposed 2012 budget S(0)UTH
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Office of the Mayor
NEWS RELEASE
September 26,2011
3:30 pm
Public input on proposed 2012 budget
Contact: Mikki Dobski, Director of Communications&Special Projects, 235-5855 or 876-1564 or
Gregg Ziemara, City Controller, 235-9216
The South Bend Common Council will conduct a public hearing during its regular meeting Sept.
26 on the City of South Bend's proposed 2012 budget. The balanced General Fund spending plan
of$64.4 million represents a 1-percent decrease from the current fiscal year.
The Council meeting begins at 7 p.m. Monday, in the 0-floor Council Chambers of the County-
City Building, 227 W. Jefferson Blvd. Although the Council will receive public input at
Monday's meeting, action on the proposed budget is scheduled for Oct. 10.
The General Fund, which pays for general government and public-safety functions,represents
the largest of six segregated sections of budget accounts requiring Council approval. The overall
City budget—which includes pensions,road projects, capital investments and user-funded
accounts like utilities—is proposed to be $263.4 million, down 2 percent from 2011.
On the expenditure side,the budget retains public-safety forces at full strength, including the
addition of five new firefighters in 2012. Efforts to reduce abandoned housing through
demolition of substandard structures again will receive $500,000 in funding in 2012, while staff
in the South Bend Parks and Recreation Department will continue to operate a full complement
of programs.
"We've presented a balanced budget to offer some flexibility so that the new mayor can consider
launching some new initiatives fairly quickly," said Mayor Stephen J. Luecke, whose term
expires Jan. 1, 2012, after nearly 15 years as South Bend's longest-serving mayor. "Despite a
loss of$21.3 million in property tax revenues for 2012 as a result of the state's tax caps,the City
of South Bend is in strong financial position through reduced spending, conservative fiscal
policy, local option income tax increases and fiscally responsible behavior."
The City's property tax revenues for 2012 are projected to be the same as 2011 —$49.6 million.
The total, however, only remains level because it includes new sources of tax revenues from the
termination of the Tax Increment Financing district serving Erskine Commons and a one-year
release of revenue from another southside TIE district serving Erskine Village. City officials are
projecting assessed values of property within the city to remain flat after declines of 10 percent,
9 percent and 5 percent for the past three years.
Local income-based tax revenues—including the County Option Income Tax, the Economic
Development Income Tax and the Public Safety Local Option Income Tax—are also expected to
remain flat. The revenues received in 2012 would have been collected as the nation passed the
low point of the economic recession.
Within the City's annual operating budget, proposed public safety expenditures of$53.2 million
represent nearly 83 percent of the General Fund budget,up from 80 percent in 2011. Staffing
funded by the 2012 budget is projected to have a net increase of seven full-time personnel
citywide, reaching a total of 1,185 full-time employees.
Within the total City budget, sewer revenue is projected to increase 12 percent as a result of a
rate increase to fund the federally mandated combined sewer overflow long-term control plan.
The water utility also is projecting a 3 percent revenue increase. Bond issues in 2012 will fund
capital projects to continue to improve sewer and water infrastructure.
In July, both Fitch Ratings and Standard& Poor's rating agencies gave stable rating outlooks to
bonds held by the City of South Bend: Fitch at AA+ and Standard & Poor's at AA. "The city's
strong finances, evidenced by extremely healthy reserve levels, have helped the city weather the
economic recession and state-enacted changes to the property tax system," Fitch reported. "In
anticipation of the negative impact of state property tax reform, and through proactive and
conservative fiscal practices, city management made strategic expenditure cuts and increased
local income taxes to replace a portion of lost property tax revenue, which has diversified
revenues and put the city's finances on firmer ground."
"The stable outlook reflects the city's very strong level of reserves and currently balanced
financial operations and, as such, we do not expect the rating to change in the two-year horizon
of the outlook," according to Standard & Poor's.
Mikki Dobski,Dir.
"VIN, Communications and Special Projects
1400 County-City Bldg
So.Bend,IN 46601
574-235-5855 w
574-876-1564 c
574-235-9892 fax
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