City of Bethlehem 2008 Budget

• 2008 Proposed Budget [PDF]
• Business Leaders Presentation (Power Point)

2008 Proposed Budget Address
November 9, 2007

Today I am proud to present a no tax increase budget for 2008--a budget that is balanced, fiscally responsible, and meets both the short- and long-term goals for the City. The 2008 Budget is a product of sound fiscal management by every department in the City and is the result of sensible management practices, cost cutting, and growth of the City’s tax base. Not only does the 2008 Budget not include a tax increase, it provides the resources necessary to meet the goals of this administration- delivering excellent city services in the most cost effective way and providing the needed investments in our community to continue to revitalize our neighborhoods and grow our tax base. We should all be proud to live in “one of the most livable cities in America” and it is rewarding to be part of this city’s renaissance.

Balancing this budget was a difficult task. The easy thing to do would have been to throw our hands up and say the situation is bleak so we have to raise taxes. Property tax increases should always be looked at as a last resort after all other options are exhausted and every other cut has been made. We have held the line on spending. The cost of government has increased by just 5.5%, which is substantially less than the local rate of inflation of 6.5%. We have steadily decreased the rate of growth of City government over the last 3 years. We have also cut fat and waste from the system and will continue to do so through the implementation of Continuous Improvement, or “CI in the City,” a program that has already produced millions of dollars of savings to the taxpayers. We have used competition to become more efficient.

We recognize that in this period of unprecedented economic expansion with $1.8 billion dollars of economic development ongoing in the City, it is necessary to add to personnel and increase city resources to meet increased demands. Governments are often urged to run their operations “like a business” to maximize efficiency and that is exactly what we are doing. Continuous Improvement with its functional peer review of our daily activity is designed to maximize each cent spent on City government and each effort by our hard working government employees. Any business that could confidently predict a measurable increase in workflows over the foreseeable future would predictably react by increasing and adjusting its staffing needs. In city government that’s a little more difficult due to the restrictions of the public budgeting process, but we’ve forged ahead with it anyway. We know the development and construction at Bethworks requires additional qualified inspectors, planners, and other professionals. Bringing them on board before this crunch hits will ensure that day-to-day business of the city does not take a back seat to this project. A homeowner shouldn't have to wait months for an approval on an addition because the inspectors are over-scheduled. And with this adjustment they won’t.

Our efforts to foster a more productive work environment, through continuous improvement, and our careful assessment of essential resources prior to having to respond to an emergency with a patchwork response again furthers the most fundamental and basic goal we have had - that is the provision of public services at the highest possible level and in the most fiscally responsible manner.

We have worked hard to put our resources on the front lines where they will impact the residents the most. In fact, this administration can honestly say the taxpayers and water and sewer customers of Bethlehem receive more and better services than at any other time in our city’s history. I now want to highlight a few of the larger investments in this year’s budget:

• Addition of three police officers
• Building Inspector
• Mechanical Inspector
• Electrical Inspector
• Community Planner
• Streets Worker
• Urban Forester
• 7 police cars
• 1 police SUV
• Backhoe for Parks & Public Property
• Various vehicles to meet other departmental needs
• $538,000 for Sand Island Improvements
• $260,000 for Skatepark – grant funded
• $130,000 for streetlight and streetscape enhancements on South Side
• $450,000 for streetlight and streetscape enhancements to our targeted Elm Street neighborhoods

The City continues to turn the corner with a $30 million increase in the tax base from last year and a total of $85 million increase since I took office. The City has more than $1.8 billion of economic development projects in the pipeline, which will bring as many as 5,000 new jobs to the city. There are also as many as 2,300 new residential units under construction with the potential to bring as many as 7,000 new residents to the City of Bethlehem—residents that will in turn support our downtown retail and commercial districts. All this has been achieved while aggressively paying down debt.

Since taking office in 2004, my administration has reduced the City’s debt by $35 million, and is on track to further reduce our debt by 50% in 7 years and 61% in 10 years. This is the 5th consecutive year that we have committed to reducing the size of our debt for future city budgets and taxpayers.

There is one other very important part of this years’ budget that I want to highlight. We have been in discussions over the last several months to resolve an issue of significant regional importance that would have a very real and material positive impact on this year’s proposed budget. I alluded to that fact yesterday.

I’m happy to announce today that we have reached a court stipulated settlement of the long standing sewer capacity dispute with Bethlehem Township which will generate $4 million from the suburban stakeholders to the City’s general fund for the 2008 budget.

We anticipate the filing of the court stipulated settlement documents as early as today.

I wish I could say more about the details at this moment; however, in fairness to the other parties involved, we will have a formal announcement of the specifics next week along with township officials and the stakeholders involved.

As I have always said we should look to the hardworking taxpayers of the City of Bethlehem only as a last resort. I’m proud to announce that due to the hard work of a variety of individuals over many months we were able to reach this resolution with the taxpayers as the ultimate beneficiaries.

I also want to thank the men and women in City government who poured out their heart and soul in making this budgetary process such a success and who truly believe their work is changing the lives of individuals in our City. These people sacrifice not only their time but a little bit of themselves in this process.

Individually, I would also like to thank each of my department heads who painstakingly tackled the difficult process of prioritizing their needs for the coming year. This time-consuming process happens over and above their normal responsibilities, and in some ways is their “final exam” for this year’s work and the platform for beginning next year’s.

Also, Business Administrator Dennis Reichard and his budget team of Budget Analyst Mark Sivak and Director of Financial Services Linnea Lazarchak have spent countless hours pouring over reports and projections to pull the budget together. They’ve also continued last year’s work toward revamping the format of our budget presentation to make it as informative and easy to use as possible. It is my belief that we have set a new standard for budget transparency not only for City Council’s better understanding but most importantly so the hardworking taxpayers of the City of Bethlehem know where their tax dollars are being spent. Each of the changes meets or exceeds the standards of the Government Finance Officers Association (GFOA). Also, this year’s budget book presents a five-year history of each line item, where we previously had only two-year worth of information.

I have done my best to encourage a marketplace of ideas in my administration and to listen to the administrators and employees of the City. I have also encouraged – in fact demanded – innovative thinking and a careful stewardship of our limited resources. These are the right people to bring us a brighter future for Bethlehem and I am proud to work with each and every member of this administration.

It has been a difficult process, but we can all be happy with the results.

I also want to thank City Council for the time that they will take over the next few weeks to review this document. My administration is available to answer any questions regarding the budget. Together we can continue to build a better Bethlehem.