Mayor presents budget; council delays action to study new revenue options
By JIM BROOKS
Nelson County Gazette / WBRT Radio
Wednesday, May 27, 2015, 11 p.m. — Bardstown Mayor John Royalty presented the city council with its first formal look at the 2015-16 budget at a special-called meeting Wednesday afternoon. After more than 75 minutes of discussion, the council delayed taking action.
Mayor John Royalty gives his budget address Wednesday afternoon at a special meeting of the Bardstown City Council.
In his budget address, Royalty said the budget included funds to hire seven additional full-time firefighters in order to have the ability to have the fire station staffed with a full crew 24/7. The move comes as the city’s contract with the Bardstown-Nelson County Volunteer Fire Department is set to expire June 30.
To pay for the additional salaries and equipment, Royalty said he will propose raising the occupational tax rate from .5 percent to .75 percent, and removing the $100,000 cap currently on the tax. If approved by the council, the changes would generate an estimated $400,000 the first fiscal year, and $1.1 million in following years.
The proposed budget also includes a variety of water and sewer projects, including work to stabilize the rubble dam on the Beech Fork River and to stabilize the river bank near the city’s pumps that send water from the Beech Fork River to Sympson Lake.
COUNCIL QUESTIONS. Most of the council’s discussion following Royalty’s presentation focused on the large fire department budget increase needed to fund an expanded 24/7 fire department, as well as Royalty’s funding mechanism to pay for it.
Councilman Francis Lydian holds up his copy of the city budget during a discussion of the proposal during Wednesday’s special meeting of the Bardstown City Council.
There are four ways a city can raise revenue — increase property tax rates; raise the occupational tax; establish a franchise fee; or create a new tax on insurance premiums.
Royalty’s plan to raise revenue by hiking the occupational tax and removing the cap didn’t get a warm reception from all of the council.
“I will not support an increase in taxes in any fashion,” Councilman Francis Lydian told Royalty. “This would affect many people in Bardstown. There are people struggling to make ends meet. All of sudden we’re going to put this expense on them?”
Lydian said the fire department budget increase was dropped on the council with little notice.
“If we had analyzed and evaluation all aspects and put a plan together, but in two or three weeks — it was boom! — spontaneous combustion.”
The city’s general fund has unrestricted reserves that could be used to pay for the first year of an expanded fire department, Chief Financial Officer Tracy Hudson told the council. However doing so would deplete the reserves.
Lydian was critical of the fire department budget jump from $1.1. million to $2.36 million. “It makes your head spin,” he said.
Tracy Hudson, the city’s chief financial officer, answers questions about the budget and general fund reserves.
The proposed budget includes the $650,000 purchase of a new pumper/tanker fire truck and equipment, Hudson said. It’s a purchase that’s only required every 20 to 30 years, Fire Chief Marlin Howard told Lydian. The purchase of the new truck was planed for 2019 but moved to 2016 due to the separation of the fire departments. The new truck will replace two fire trucks — an existing pumper and a tanker truck.
Councilman Fred Hagan said the requests in the budget were well-documented and he had no problems approving them. He voiced reservations about hiking the occupational tax to fund the needed revenue
Hagan said that before the council decided on how to raise revenue it should consider all of the options it has to do so.
“The state gives us four ways to raise revenue, and I suggest we look at them all,” Hagan said. He noted that most other small cities have an insurance premium tax.
Councilman Roland “Coach Roe” Williams poses a question to Bardstown Fire Chief Marlin Howard.
Royalty told the council that he never wanted the fire department merger issue to lead to a separation of the departments — the taxpayer-funded city fire department and the dues-funded non-profit volunteer fire department, which handles fire protection outside the city limits.
“My ultimate goal was to combine the two in order to have a 24/48 fire department,” he said. “We have to move forward from this point on, we can’t talk about what should have been done. We have to do what’s best for the citizens of Bardstown.”
Lydian said in his years on the council he’s worked closely with the fire departments. The split and its impact on the budget has only been discussed for 30 days, he said. “If we had planned it out and looked at our options, I wouldn’t have a problem with it. I think we’ve put the cart before the horse.”
He again told the mayor and council of his disappointment that he wasn’t part of the fire department discussions, adding that he has considerable experience that may have been of value.
Councilman Bill Buckman said he attended fire department meetings prior to taking his seat on the council. While he said he didn’t like the idea of paying more in taxes, the proposed occupational tax hike is justified.
Councilman Bill Buckman spoke in favor of taking action to fund the expansion of the fulltime staff of the Bardstown Fire Department.
“It’s going to be a small price to pay for the protection that the City of Bardstown deserves,” he said.
Buckman noted that Larry Green’s report to the council’s Safety Committee documented that other cities Bardstown’s size already have a full-time 24/7 fire department. Those cities in Green’s review depend on an occupational tax rate higher than Bardstown’s or a tax on insurance premiums to fund their fire service. Bardstown does not have a tax on insurance premiums.
Councilman Bobby Simpson said he had heard that individual volunteer firefighters are saying they won’t respond to city fires after the departments separate. Howard said that even with the addition of seven fulltime firefighters, the city fire department will continue to depend on its volunteers.
Councilwoman Kecia Copeland asks a question about the fire department funding 2015-16 budget request.
The fulltime firefighters will staff the first truck out of the fire station, Howard said. Additional firefighting trucks will need to respond and manned by volunteers. “We’re going to need to depend on our volunteers,” he said. “That’s not going to change.”
Councilwoman Kecia Copeland asked for clarification of the funding mechanism that will be used to fund the fire department expansion. The city budget and how the council decides to raise revenue to fund it are related discussions that will involve separate votes, Royalty said. The council’s immediate concern is the budget, which must be approved by June 30.
After more than an hour of discussion about the budget and revenues to fund the fire department expansion, the council agreed to postpone first reading on the budget until a special meeting prior to the June 2 City Council 5 p.m. working session.
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