Riverside begins looking at 2014 budget with levies planned

City Manager Bryan Chodkowski presented to council last week a preliminary glimpse of next year’s operating budget, and the city is projected to be $222,600 in the red in 2014 based on numbers through August.

City officials are optimistic that number will be closer to zero after factoring in income and property tax projections for the remainder of this year. The final 2014 operating budget won’t be voted on by council until later this year.

Riverside will have a half percent income tax increase on November’s ballot and a police renewal levy on the ballot in 2014.

“We’ve gotten the city moving in the right direction,” Councilman Mike Denning said. “We need to get those passed or we’ll end up back where we were, and that’s not a good thing. Having the proper amount of income to keep the services that our citizens are used to is as important as anything.”

The city projects to generate $9.16 million in revenue next year, up more than $200,000 from 2013 — mainly from the council’s decision to reduce the income tax credit. The city projects to spend nearly $9.4 million operationally in 2014, and those numbers do not include capital expenses.

Personnel costs are projected to jump more than $300,000. Health insurance costs will increase 16.5 percent, with seven percent of that tied to the Affordable Care Act, Chodkowski said.

“We’re not handing out big raises,” he said. “We can control the expenses that are within our control, but we can’t control health insurance. We will continue to look at additional revenues.”

On Nov. 5, Riverside is asking voters to pass an income tax rate increase from 1.5 percent to 2 percent — which, if approved, would generate about $1.42 million annually in new revenue.

The income tax increase would be “for purposes of general municipal operations, maintenance, new equipment, extension and enlargement of municipal services and facilities and capital improvements,” according to a resolution passed in June that set the ballot language.

Additionally, residents also should expect a 4.95-mill police renewal levy on the ballot in 2014, Chodkowski said. The levy generates about $1.12 million a year for operations and expires at the end of 2014.

Last December, council approved reducing the income tax credit from 1.5 percent to 0.75 percent. Council agreed to earmark the money for capital expenses, and about $630,000 is expected to be generated this year from the reduction in the income tax credit.

Mayor Bill Flaute has been vocal about setting the income tax credit back to what it was since residents will be voting to increase the income tax rate next month.

“I didn’t see any surprises. It was big picture stuff,” Flaute said of the preliminary budget discussion. “I think we can look forward to a good, solid year ahead of us.”

Resident Shaun Doerner said the city needs those levies to pass, but was skeptical if they would because of the “sour taste in a lot of people’s mouths” from the income tax credit reduction.

Although Doerner said he would vote in favor of the levies, he said the city would be in trouble financially if they don’t pass, especially since it is spending $5 million this year on road projects.

“They’re dropping a lot of money on the road projects,” he said. “It needed done, but at the same time, if it doesn’t pass, they’re in a tough spot and they’re going to run out of money real soon.”

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