Water fee flap stalls Amsterdam's budget plan
Rate hike cap means shortage
AMSTERDAM The Common Council voted to restore the 3 percent cap on annual water rate increases Friday night, which opened up a $629,389 gap in the city’s 2011-12 tentative budget. The council spent the rest of the meeting trying to eliminate the gap.
The council called a special meeting to discuss the tentative budget. But after nearly two hours of wrangling, was still unable to adopt a budget and set another meeting for 6:30 p.m. Monday.
When the meeting began the tentative budget was balanced thanks primarily to two controversial items: a proposed local law to require city employees who retired before the late 1990s to begin contributing 10 percent of the premium cost of their city provided health insurance; and a local law that would eliminate the city’s cap on water fee increases and raise rates by 17 percent. Both items were included in the tentative budget after the budget committee approved them, but both would require new local laws.
First Ward Alderman Joseph Isabel put forward a resolution to remove the $629,389 generated by removing the 3 percent cap. The majority of the council agreed with him.
“I’ve been getting a lot of phone calls from people on this and I just don’t think it should be changed without a referendum. The people put the cap in place with a referendum and only the people should be able to remove it,” he said.
The council then considered a series of budget cuts. Fifth Ward Alderman Richard Leggiero suggested a host of cuts, including cutting three members of the both the Fire and Police departments. Leggiero’s proposed cuts totaled $589,000. Some of his suggestions, which he described as belt tightening moves, were vague and Mayor Ann Thane questioned their legality.
The council rejected Leggiero’s proposal to cut three police officers after determining the move could cost the city $100,000 in police officer overtime and another $66,000 in unemployment benefits. The savings from eliminating the officers would amount to only about $14,000. Cutting three firefighters was also rejected. Some of his other proposed cuts will be considered on Monday.
Leggiero questioned whether he’d come to the next meeting after his layoff proposals were rejected.
“You don’t need me here,” he said.
Isabel was more successful. He suggested eliminating the city’s animal control officer and replacing him with a contractor at a per diem rate. He also suggested replacing one Department of Public Works employee with a cleaning service. Both moves were approved.
At the end of the meeting, city Controller Heather Reynicke said the deficit had been whittled back down to $436,000, still leaving much work to be done.
Among the proposals still under consideration is elimination of the city engineer position.
During the meeting Thane argued for restoration of some or all of the increase in water fees. She said using the water rate to raise revenue, which also affects people living in the town of Amsterdam, would save city taxpayers more than drawing more money from them in property taxes.
A crowd of what appeared to be mostly current or retired city employees packed the tiny meeting room on the second floor of City Hall Friday night and spilled out into the hallway. After more than an hour of budget discussions an elderly man got up from his chair and shouted at the council before leaving.
“You’re talking about everything else, all these people are here because of the retiree health insurance,” he said.
“Sir, we already decided that issue,” Thane said, referring to the council’s budget committee decision to include the revenue from the premium increase in the 2011-12 tentative budget.
Members of the public, and the council, seemed confused as to what action had been taken.
Corporation Counsel Gerard DeCusatis said that although the council had voted down the tentative budget at its Tuesday night meeting, the premium increase for retirees remains in the budget.
To implement the increase the council will need to pass a local law overturning the current law that allows the city’s pre-late 1990s retirees to have free health insurance for life. The earliest the council could do that would be this coming Tuesday, seven days after a resolution to change the law was introduced. The same holds true for a proposal to remove the water fee cap.
The premium increase is expected to save the city about $200,000. Reynicke said the 10 percent premium contribution would cost a retiree with a single coverage $60 per month, a two-person plan $129 per month and a family plan $136 per month.