By Josh Davis, Associate Editor

(April 4, 2019) Berlin Town Administrator Laura Allen, in an interview last Thursday, weighed in on how expected tax and fee increases would affect the fiscal 2020 budget, and what will happen next in the process.

She also defended town staff after some workers were criticized during a well-attended budget hearing last week.

Public interest in the budget is unusually high this year, because of fee increases across several utilities and proposed property tax increases said to range anywhere from 20-34 percent. Allen said all the public comments received during recent months have factored into developing the budget.

“The mayor and council will take [public input] into consideration as part of their decision-making process,” she said, adding that the staff on Monday would present general fund budget proposals that relate to real estate property taxes.

“I’m not sure if they’ll give us any direction [on the tax rates] or not, but the tax rate conversation will continue,” Allen added.

She admitted it “might have been easier, at least for staff-planning purposes, if the rate had been set by now,” indicating the tax-rate controversy has had some impact on budget development.

“There’s a lot of discussion and, I think, important conversation that needs to be shared, so it makes sense to me that it’s taking a little bit longer than we had originally thought in terms of getting the rate set,” Allen said. “It’s a big decision and it affects a lot of people, so to me it makes sense that they take the time they need to, to make that decision.”

Asked if town officials are considering a phased-in tax increase, as some have called for, Allen replied, “of course.”

“I stand by what the mayor said Tuesday night, which is that we’re taking all of this into consideration,” she said. “I’m not a decision maker in this process, but I work closely with them and I see them taking all of that into consideration, definitely.”

Allen said the final budget is a group decision of the Town Council, but “it’s the mayor’s budget” that would be presented publicly first.

“He will be the one who sort of makes the initial presentation, so I’m expecting that to happen on Monday, but it may not,” she said. “For planning purposes, we’re still in pretty good shape, but we will need [the council] to give us some direction relatively soon. Hopefully, ideally, on Monday, but we’ll just have to see.”

The budget process began in January, when the staff examined the current fiscal year’s finances and projected the final numbers, Allen said.

“We start looking at what our revenue sources may look like and we start planning from there,” Allen said. “We look at what we need to accomplish and what we can fit into the revenue that we have.”

She said the town “has developed a practice of tapping into reserves,” that has now led to the need for tax and fee increases.

“That’s not uncommon when you’re talking about managing a city budget, especially when you’re looking at tapping into reserves for one-time projects, which are typically capital projects [such as] a new culvert, a new well house [or] replacing a lift station. Those are all projects that have a beginning, a middle and an end,” Allen said. “Where I think the town has developed some problems is tapping into reserves for recurring expenditures, things like employee salaries [or] office supplies, which are every year.

“If you start tapping into reserves for recurring expenditures it’s a problem, because you’re digging into your savings account on an ongoing basis and, in our case, there’s not enough tax money coming in to replenish it,” she continued.

Allen reiterated the recent assertion by Councilman Thom Gulyas that the town is not in crisis or close to running out of money.

“But we need to look at the way that we manage our money and look at doing things differently, for sure,” she said.

When asked why it took so long for town officials to address the practice of spending reserve funds and their subsequent decline, Allen said, “The trend has been shared and conversation has been had on that topic for a while.”

Asked why no action had been taken previously, she said, “It’s hard to say.”

“On that one, you should probably talk to the mayor,” Allen said.

Some have called for the Berlin Falls park property, purchased for $2.5 million in 2016, to be sold to replenish the general fund. Allen said the property would have to be sold for about $3.4 or $3.5 million just to break even.

“I’m not sure if there’s a market for that,” she said, adding she had received no direction to look into doing so.

“Not yet,” Allen said.

As for whether the tax-rate debate has affected the departments’ development of their budgets, Allen said, “It’s never easy to hear people say that you’re not doing a good job or you’re misappropriating funds, or you’re not using taxpayer dollars wisely.

“From that standpoint, each of the department directors – and I’ll just speak for myself – it’s hard to hear that, because I think they’re all very responsible, very hardworking people. And we do our very best to stretch those tax dollars as far as we can,” she added.

For example, regarding a resident question last Tuesday about a well house, Allen said bricks for the structure were taken from another project that was funded by a grant, “so those bricks actually didn’t cost [the town] anything.”

“There’s those kinds of things that we’re doing that we know about, but we’re probably not doing a good enough job of sharing that information with the community,” she said.

Allen also addressed a comment last Tuesday about town employees who appeared to be driving around aimlessly and, theoretically, wasting taxpayer dollars.

“One of the bigger challenges of our job is to make it obvious to people that we’re not just driving around with nothing to do,” she said. “Frequently, folks are either reading meters or they’ve been called to a property to take a look at a particular situation, like maybe there’s some sort of flooding or holes in the backyard.

“It’s kind of a challenge to figure out how to let people know that what they perceive as somebody just driving around in a vehicle is actually hardworking employees getting to their next call, or getting to their next assignment,” Allen added.

As for sharing information, Mayor Gee Williams recently spoke about ways to improve the flow of information to the public, including better efforts on social media.

Last Tuesday, those who attended the public hearing could scan a QR code with their smart phones that provided a link to the current fiscal year budget, a suggestion from Town Councilman Zack Tyndall. Allen also mentioned recording informational presentations and making them available online.

“I will say this, I think it’s kind of a challenging conversation to have if the information is just going out one way,” Allen said. “To really work on this, we need to have a two-way conversation, and that’s really going to require people to be in a room and to talk to their neighbors about what their values are and what their priorities are, and what they really want the town to be working on.

“From my standpoint, the more of those conversations we can have, the better off we’re going to be,” Allen continued. “We’re at a very interesting time and there’s a lot of important work and good conversations happening, and I think people are much more interested in what’s going on with the town’s budget process. And all of that, I think, is very positive.

“I think there’s a way to have those conversations around priorities and what we should really be doing with the taxpayers’ dollars,” Allen said. “But I would suggest that it’s not necessarily beneficial to have a large group of people all talking to us at the same time, as opposed to putting people in a room and having conversations amongst neighbors about what the town should really be doing. I’d like to hear what people think of in terms of their priorities and what they’d like to see us work on.”

The general fund work session held on Monday, April 1 and a utilities fund work session scheduled for Monday, April 15 at 5:30 p.m. at Town Hall on 10 William Street generally do not allow for public comments, but are rather staff reports to the mayor and council. The meetings are, however, open to the public.

Allen said public comments are encouraged during every Town Council meeting, both during the public comment portion listed on agenda, and during discussion of individual agenda topics. To be recognized, a speaker needs to raise his or her hand and wait to be called, Allen said.

The next two Town Council meetings are scheduled Monday, April 8 and Monday, April 22, both at 7 p.m. at Town Hall.

A public hearing to set the fiscal 2020 tax rate and constant yield rate is scheduled for May 13, and a public hearing to adopt the fiscal 2020 budget is set for June 10.

For more information on upcoming public meetings, visit www.berlinmd.gov/maryland-government/council-meetings.