Councilors to examine Pluta's city budget

Date: 5/10/2011

May 11, 2011

By G. Michael Dobbs

Managing Editor

HOLYOKE — Some city councilors responding to Reminder Publications said they would examine the fiscal year 2012 (FY12) city budget carefully before suggesting changes, but one councilor believes that if passed as written, the budget will spur an increase in taxes.

"Taxes will go up if approved as presented," Councilor Linda Vacon said.

"I just got the budget Tuesday night, so I am not prepared to make a statement on the budget but I will tell you I am looking at it closely and will question all increases in any department," Councilor Aaron Vega said.

Councilor Brenna Murphy said, "I just received the budget and I am in the process of comparing last year's budget to this one, as well as reviewing the mayor's suggestions. Over the next few weeks, we will be calling in department heads to go over the budget and see what changes, if any, need to be addressed."

In her address to the City Council on May 3, Mayor Elaine Pluta said that despite financial challenges, her FY12 budget avoids both layoffs and furloughs.

Pluta presented a budget of $120.28 million, which will require $1.5 million from the current free cash account. That amount may be reduced by $200,000 if additional monies for the sewer fund are discovered.

Some city department heads received "very modest increases" to their salaries, which was a reward for "extraordinary efforts to save the city time and money ... Their hard word is evident in the savings to this year's budget," she said.

Pluta said the city has saved money through an early retirement program, the reduction of outside legal expenses, the pursuit of back taxes and fees and an increase in the cost of health insurance of below 2 percent. She added, though, the pension liability funds will increase by $500,000 in the next fiscal year and there is $393,000 in long term and short term debt.

Pluta would like to offset these increases by selling more excess city property, instituting "a small increase" in the meals and hotel tax and changing the payment in lieu of tax program.

She noted there have been 73 new businesses in the city in the past fiscal year.

"I believe we have bottomed out of our lowest point and are on our way back up with many new visible investments that are on the horizon," she said.

The Holyoke Geriatric Authority has become "a burden on our taxpayers" and Pluta intends to meet with the authority's Board of Directors, which she suggests the City Council do as well.

"Tough times call for tough decisions and I am going to provide critical leadership on this issue with compassion but with fiscal responsibility," she said.

Pluta added that she has formed a committee of city councilors, the city's financial team, residents and business people to find additional ways to save the city and taxpayers money while still delivering needed city services.