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City could face budget deficit

September 02, 1998|By JULIE E. GREENE

With the City of Hagerstown having faced its first deficit in 11 years, city officials on Tuesday discussed ways to prevent another shortfall this budget year, officials said.

The city had a $216,829 deficit from the $19.5 million general fund for the fiscal year ending June 30, 1998, and is looking at a possible $336,136 deficit this fiscal year, according to preliminary numbers.

The last time the city had a deficit was in fiscal 1986-1987. That deficit of $344,446 was blamed on bad winter and an increase in the overtime pay rate, City Finance Director Al Martin said.

Contributing to last budget year's deficit were police overtime costs, failure to sell a second lot in the business park and a refund of $104,000 to C.M. Offray & Son Inc., also known as Maryland Ribbon, because the firm overvalued its personal property on tax returns in 1995, 1996 and 1997.

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During Tuesday's work session, City Council members discussed ways to make up for an estimated $342,100 shortfall in revenues this budget year.

City Council members agreed with recommendations by Martin and City Administrator Bruce Zimmerman to delay some purchases until the spring in case the city experiences a severe winter and exceeds the $173,123 snow removal budget.

The city will hold off on replacing 50 benches at City Park and several vehicles, including four police cruisers.

Zimmerman said the city is not in a crisis situation.

City officials have forecast upcoming steep deficits for years and now the city is reaching tight budget years, he said.

According to projections, a $1.7 million deficit is expected in fiscal 1999-2000 with higher deficits anticipated through at least fiscal 2003-2004.

A big reason for the deficits flat property tax assessments, Martin said.

The city has increased police and fire staffs and taken on several costly but important projects, such as aiding the construction of the ice rink and redeveloping the Hagerstown Fairgrounds, Zimmerman said.

"Our goal with the projections isn't to scare anybody," Martin said. City officials will adjust the budget so they don't become a reality, he said.

Councilman William M. Breichner suggested trash pickup be cut back to once a week and mixed paper recycling pickup be eliminated or reduced.

City officials should find ways to reduce the city's costs for maintaining Municipal Stadium and the Potterfield Pool, possibly closing the pool, Breichner said.

The city loses about $100,000 on the pool and $80,000 on the stadium annually, Martin said.

Councilwoman Susan Saum-Wicklein suggested charging property owners of newly annexed land for fire and police services.

Saum-Wicklein also suggested changing the formula used to determine the size of the tax rebate the city gets from Washington County for duplicated services, such as police.

Mayor Robert E. Bruchey II said sewer services could be added to the formula.

Councilman Alfred W. Boyer wants to review how to reduce personnel costs, which account for 75 percent of general fund expenses.

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