LWVS and Scarsdale Forum Make Statements on the Proposed Village Budget

The League of Women Voters of Scarsdale and The Scarsdale Forum Fiscal Affairs Committee issued the following statements on the proposed 2020-21 Scarsdale Village Budget:

The League of Women Voters of Scarsdale

The League of Women Voters of Scarsdale Board of Directors (“the League Board”) thanks Village Manager Steve Pappalardo, Village Treasurer Mary Lou McClure, Mayor Marc Samwick and the Board of Trustees (the “Board”) for conducting a well-managed process and proposing a budget that balances careful fiscal management with resident expectations of Village services.

As the League was unable to hold its annual general membership and consensus meeting on the Village Budget, the following comments reflect the views of the League Board.

Overview

The current proposed General Fund Village Budget is $59,238,049, which includes a tax levy increase of 1.46%, a $95 increase per home for the average Scarsdale homeowner. As per Village Treasurer McClure, in the regular budget process, the primary drivers of the budget are moderation in health insurance premiums, the flattening of building permit and mortgage tax revenue, sales tax revenue, the settlement of some bargaining unit contracts and pension payments. According to Treasurer McClure, the SALT deduction impact was an additional influence on Village efforts to keep the budget-to-budget increase as low as possible. In addition, the New York State imposed tax levy cap of 2% influences Village budgeting efforts and process.

Regarding advocacy in terms of SALT, the Village is a plaintiff in a federal lawsuit against the IRS with regard to the SALT deduction.

General Fund Balance

According to Treasurer McClure, the current fund balance is slightly in excess of $8 million, which is 13.89% of the 2019- 2020 budget. This percentage is down from recent years where the fund balance was approximately 14.5% of the succeeding year’s budget. This fiscal year, more funds were devoted to road resurfacing. The Village policy has been to have unassigned fund balance levels between 10% and 15% of the next year’s budget. According to Treasurer McClure, “this policy has worked well for the Village even though Moody’s would like to see higher levels. The Village has had a policy of transferring budget surpluses to capital, which helps to reduce debt levels.”

In response to the League question about fund balance use in the event of an emergency situation, Treasurer McClure explained that the “total fund balance consists of both assigned and unassigned fund balance. In the event of an emergency situation, the Village Manager would recommend re-assignment of existing assigned balances to meet the needs of the emergency.”

The COVID-19 Health Crisis

As priorities have changed based on the current COVID-19 health crisis, the Administration and Board have conveyed that they are intensively focused on issues related to Village operation, the safety of residents and monitoring the various ongoing and changing aspects of the crisis.

According to Village Manager, Steve Pappalardo, the Village is focused on “maintaining essential services as we continue to navigate through this emergency.” The Village has moved to austerity spending, which will remain into the 2020-21 fiscal year. In addition, department heads have been directed to restrict spending to essential items required for the operation of the Village and for their response to the current pandemic.

As per Treasurer McClure in response to League questions, “The Village is following the directives of the County Board of Health and the State. We are trying to implement as many ways to communicate with residents as possible during this difficult time while still maintaining Village services. However, this is a developing situation that will require that we all be flexible going forward.”

As discussed during the March 31 Village Board meeting, the Village has created a COVID-19 contingency account and has reallocated $340,000 from the 2020-21 budget into this account. From the current year’s budget, $1.255 million from the general fund has been reassigned to the COVID-19 contingency account. Ten of the thirteen general fund departments have been impacted by the fund reassignment. Altogether, as discussed by the Village Manager at the March 31 meeting, there will be $3,485,000 total funds available to the Village for emergency management related to the COVID-19 outbreak.

Trustee Arest stated, the “Village is reducing unused funds and potential discretionary projects in the current fiscal year and putting that money into a COVID-19 contingency account to keep us prepared. Staff has also identified capital projects that will need to be eliminated or reduced in the upcoming fiscal year.”

At the March 31 budget work session, Treasurer McClure discussed revenues most likely impacted by COVID-19. The Village Treasurer went through two potential 2020-21 budget scenarios in order to show stress testing of significant non-property tax revenue at two distinct levels, to determine potential impacts to the village’s cash flow and fund balance. The League Board recognizes that there are many potential impacts to revenue as a result of the COVID-19 health crisis; and we understand that as per the Mayor, the Village Administration and Board will continue to evaluate and look at the budget as the year progresses. The Village Board has the ability to modify the current fiscal year budget as necessary throughout a given fiscal year.

Grant Funding and Capital Projects

As per Treasurer McClure, the Village has been awarded several grants, including the Cayuga Pond Project grant to address neighborhood flooding; the Heathcote Road Bridge grant for $1.597 million; the Village share of the Hutchinson River Drainage Project; and the Community Development Block Grant (CDBG Grant) for $50,000 for the upgrade of the Village Hall elevator. These are multi-year projects in various stages of development. According to the Village Manager, “managing this pandemic emergency and the adverse economic impacts, which will be felt for a while, are severely impacting municipal budgets at all levels. As the Village’s “grants-in-hand” are from Federal and NYS departments/agencies as well as from the County of Westchester, I imagine that some could be jeopardized depending on the severity of the budgetary implications at all levels and how far along the projects are toward completion.” The Village Manager also noted that there is language in the Fiscal Year 2020-21 New York State budget indicating that the Legislature can “pull back on current funding levels based on quarterly budget progression review.”

Regarding capital projects, the Board has paused the Freightway Redevelopment Project; the Village Hall repair/replacement will need to be addressed in planning stages over the next four to five years; and needed renovations to the Scarsdale Pool will be addressed following a Recreation Department survey of the community’s interest and needs.

As suggested by Village Manager Pappalardo during the League’s 2019 information session, the scope of work required at Village Hall is significant enough to consider the possibility of building a new Village Hall in the existing parking lot while keeping the old building open during construction; this would avoid the expense of relocating Village staff and government services, which occurred during the Popham firehouse renovation.

The League Board continues to recommend that, post COVID-19 emergency management, the Board and Administration engage in a thoughtful and comprehensive public dialogue about major capital projects and other capital infrastructure needs, including that of the Scarsdale Pool, as well as to discuss the plan for financing such maintenance, repair, and improvements and to publicize these long range plans.

Staffing

This year the Village hired a part-time code enforcement officer to aid in the enforcement of the Village code. The part-time officer includes weekend inspections to minimize the work of contractors who may be trying to avoid Village enforcement efforts. The part-time code enforcement officer has had some success in stopping unauthorized work. According to Treasurer McClure, the Village has collected fines in excess of $18,000, but more importantly, the “STOP WORK” orders he has issued has resulted in revenue in the form of building permits.

Evaluation of the Food Scrap Program

The Food Scrap Program’s curbside collection has been put on hold as the Village is planning Sanitation staffing levels to avoid exposure to COVID-19. Thus, the Village has temporarily stopped home pickups for food scraps. At this time, residents may bring their food scraps to the sanitation yard.

When the program resumes, as the League recommended last year, we look forward to the assessment of the food scrap initiative and the presentation to the public of all relevant data collected by Village staff and all additional metrics by which the community may understand both the environmental and financial impact of this program.

Village Board Working Sessions, Formal and Informal Opportunities for Public Input

The League Board reiterates commendation for the Mayor in his effort to engage the public in venues of informal dialogue, for example, at his “Coffees with the Mayor.” As the League promotes the active participation of citizens in government, we commend the Mayor for being proactive in soliciting input from community members. The League Board would also like to recognize another way that the Village Board communicates with the community, which is through Board Liaisons to community groups. The League Board is appreciative of this continuing Board initiative.

The League Board recommends that the Village Board engage in consistent outreach to obtain wide-reaching community input and feedback. An ongoing process of engaging in dialogue with community members and groups will help the Board more fully understand constituent views and broader community values.

The League Board values voter education and strongly recommends that all meetings of the Village Board, including the working sessions, be recorded and if possible, live-streamed for greater resident participation and accessibility to Board discussion.

With regard to ongoing hot button issues, such as the potential future renovation or redevelopment of the Freightway garage, the League Board encourages timely Board communication, transparency, the inclusion of community member input in the process and that benchmarking research of comparable development, including the pros and cons of development at the site be made available to the public. The League Board encourages the Board of Trustees to directly engage in thoughtful and thorough public communication with the Board of Education and School Administration as well in any process to consider redevelopment at Freightway.

The League Board thanks the Village Administration and Board for your professionalism and dedication to our Village. We would especially like to thank Village Treasurer, Mary Lou McClure, who is retiring this year. Treasurer McClure has always been kind, responsive, accessible and helpful regarding all of our League questions on the Village Budget. We appreciate her extraordinary service to the Scarsdale community.

Thank you for taking our comments into consideration.

Sincerely,

Board of Directors, League of Women Voters of Scarsdale

The Scarsdale Forum Fiscal Affairs Scarsdale Committee

The Scarsdale Forum Fiscal Affairs Scarsdale Committee has issued a report on the 2020-2021 Village budget, based on in person observation throughout the Village budget process and factoring in recent modifications made by the Village Board in response to the COVID-19 health crisis. Notwithstanding crisis-related concerns about shortfalls in anticipated non-property tax revenues as well as potential unanticipated expenditures, the committee recommends the approval of the tentative budget provided that the Board and Village Staff rigorously monitor non-property tax revenues, reduce non-essential operating expenditures as needed and “take a closer look at the remaining capital expenditures in the tentative budget and identify items that could be deferred to maximize reserves.”

The report offers a detailed analysis of the Board’s adjustments to the tentative budget that modestly reduced the tax levy while continuing to support existing service levels, and its adjustments to the current and the tentative budgets to create a $3.5 million COVID-19 contingency account.

Noting that the Board is legally permitted to modify the budget throughout the year, the committee “expects that expenditures for non-essential services will be reduced” as needed and appropriate in the current and next fiscal year. The report offers several areas for the Board to consider for potential reductions, such as professional development and travel; consulting fees; curbside leaf pickup; rear door trash and recycling pickups; and reducing or deferring the proposed 2% salary increases for non-union employees. Recognizing that certain expenses will not be incurred due to the health crisis, the committee does not endorse drastic measures such as staff layoffs at this time.

Because there is insufficient information about the trajectory of the pandemic and its economic effects to accurately forecast revenues or expenses, the committee recommends regularly scheduled public work sessions for discussion of these matters, stressing again that the Village should be planning now with the community to identify potential service cuts.

Anne Hintermeister, chair of the Fiscal Affairs Scarsdale Committee, said, “We thank the Board for its effective collaboration with the staff in preparing the budget, particularly responding to and communicating about the fiscal effects of the COVID-19 crisis. Going forward, we strongly recommend that the Board engage with the community to identify the expenditures and services that could be eliminated as non-essential. We also thank the Village employees who are coming to work to protect and care for our community. Nothing is more important than keeping them safe and on the job, and we support any additional expenditures or service adjustments to ensure that they are.”

The full report is available here.
https://www.scarsdaleforum.com/Reports/View/830/25