Helfrich says brace for the worst ahead of 2021 budget hearings
York City Mayor Michael Helfrich is prepared to present what he calls a "horrible" budget at the city's first budget hearing Tuesday night, one that includes tax hikes and job cuts.
During Helfrich's weekly Monday message, Helfrich said that in response to an anticipated $14 million budget deficit residents should prepare for the worst, although there is a chance an alternative budget he has prepared could soften the blow.
"It's a horrible budget," Helfrich said. "It includes cutting lots of jobs, cutting police officers, and it includes raising fees and taxes dramatically," Helfrich said.
The Democratic mayor attributed the budget issues that have plagued the city for years on an outdated tax system that relied on too heavily property values and higher incomes among residents, areas where York City now struggles.
City revenues have further plummeted during the COVID-19 pandemic, and this year, it has no savings left to buoy the budget.
The city has already seen a $3 million decrease in earned income tax revenue as it prepares for a wide variety of budgetary issues.
For example, city is facing a $4 million increase in pensions costs, Helfrich said.
That comes along with the fact the city has to take care of $2.5 million in wastewater treatment plant upgrades with another $37 million in upgrades over the next 10 years.
That possible solution comes via a second budget that relies upon the sale of the wastewater treatment plant, which officials have called a money pit.
"If we can get a good a price on the wastewater treatment plant, we can reduce our taxes by over 20%, we can put money said to help people with our sewer and refuse bills," Helfrich said.
The sewer's maintenance fund, which is used to maintain the sewer system as a whole, reported a net loss of about $403,000 in 2019.
And despite the fact the intermunicipal sewer fund showed its revenues exceeding expenditures by about $2 million, the city adjusts payments made by connected municipalities the following year to make it revenue neutral.
The city has yet to decide whether it wants to sell the wastewater treatment plant despite releasing a request for proposals in July.
Municipalities that use the wastewater system have indicated they're interested, at least in purchasing the plant alone.
In late September, five municipalities surrounding York City approved the creation of a regional sewer authority with the hope of buying the city's wastewater treatment plant and keeping sewer rates under local government control.
But no decision has yet been made as the city continues to pour money into upgrades.
York City Council last week approved earmarking millions of dollars in bonds to make repairs to the city's wastewater treatment plant as officials mull selling the sewer system.
In a unanimous vote, council members approved an amendment to the city's $10 million sewer bond that lays out money to repair filters and replace the outdated automated computer system that runs the plant.
The bond amendment states that up to $6.8 million will be used to repair or replace effluent filters. It also states that up to $700,000 will be used to upgrade the control and data acquisition computer system.
Throughout meetings this week, Helfrich said, tough decisions will need to be made if the city has any hope of bringing in more businesses and increasing property values.
"Can we eliminate more police, can we eliminate mowing of the parks and the trimming of trees, can we not pave any more streets? Those are possibilities," Helfrich said.
All three of the week's budget hearings will be livestreamed on Facebook and Zoom at 6 p.m.:
- Tuesday: Hearing covers elected officials and business administration.
- Wednesday: Hearing covers the departments of economic and community development and public works.
- Thursday: Hearing covers police and fire departments.
— Logan Hullinger can be reached at firstname.lastname@example.org or via Twitter at @LoganHullYD.