Purzycki called for a 7.5 percent increase in property taxes and the elimination of 29 vacant positions. He said the moves would not affect public safety.
Many of the positions are in the Fire Department, which suffered the loss of three firefighters last year. Deaths and injuries resulted in a $6.5 million bill to the city, which for some reason did not have catastrophic coverage.
Purzycki went on to say that while the state of the city is stable, there is a need to reinvest in economic development and infrastructure, to enhance government efficiency, control costs and eliminate projected budget deficits.
He also said we must institute new initiatives to control crime, strengthen neighborhoods, increase employment and improve the delivery of city services.
The revenue plan, according to Purzycki, will produce $3 million in additional revenue in fiscal 2018 that will help the city manage its structural deficits over the next four years.2018 Proposed Budget Stand Alone Summary
The mayor said his budget proposal eliminated a projected deficit for fiscal 2018 and 2019 and will help the city better manage projected multi-million dollar deficits in FY 2020 and FY 2021.i
He said if the city takes no action to tackle the deficits, Wilmington would be facing a cumulative budget shortfall of $19.3 million by fiscal 202.
To balance the FY 2018 budget and reduce future year deficits, the Mayor is proposing a combination of $2.5 million in budget cuts, including the elimination of 29 vacant positions, and a 7.5% property tax increase.
Purzycki said shortly after taking office in January that it became clear to him that the city was already $14 million in the hole even before work began on a new budget. Contributing to the problem was:
- An unbudgeted city employee pay raise granted last year totaling $6.7 million
- The loss of $1.4 million from the City’s right-turn-on-red safety camera program because of action by the Delaware General Assembly
Purzycki said other factors affecting the City’s current budget dilemma include:
- A decrease of $3 million in the city wage tax as projected by the Wilmington Economic and Financial Advisory Council.
- Overtime costs for police and fire which is trending toward $2 million over budget
- A projected $1.2 million increase in employee and retiree health care benefits for next year
The city’s bond rating agencies have warned that if the fund is further depleted it will cause Wilmington’s bond rating to drop and increase borrowing costs.
To begin to mitigate the city’s projected deficits for the next four years, the mayor is proposing a fiscal year 2018 operating budget totaling $154.1 million, which is an increase of $94,000 or 0.1 percent from 2017.
To balance the new budget, Mayor Purzycki is proposing a reduction of 29 full-time positions for a savings of about $2.5 million, plus additional expenditure reductions.
Purzycki is also proposing an FY 2018 water and sewer budget totaling $71 million, which is a reduction of $2.2 million or 3 percent from FY 2017. This budget supports initiatives begun in recent years to achieve financially self-sustaining and environmentally-sound water, sewer, and stormwater utilities. These include an accelerated Combined Sewer Overflow (CSO) mitigation effort, and finished water filtration and supply improvements that exceed EPA standards.
To fund Wilmington’s water and sewer needs, Mayor Purzycki is proposing a 4 percent increase for water and sewer rates.
Purzycki said he will introduce initiatives that will include new police leadership and a multi-faceted approach to reduce blight and crime in targeted neighborhoods, while restoring parks, such as Rodney Square.
Wilmington City Council will review the Mayor’s budget proposals over the next several weeks. A final budget vote is scheduled for May 18.