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June 11, 1974
<br />
<br />Council policy in the past,
<br />
<br /> The proposed budget of $43,475,332 represents an increase
<br />1973-74 budget. Percentage-wise this is an increase of 10.6%.
<br />mately 1.78 million dollars is atributable to the School Board
<br />to the remaining General Fund Expenditures.
<br />
<br />of ~4,143,021 over the
<br />Of this increase approxi-
<br />and 2.36 million dollars
<br />
<br /> The increased School Board Budget permits an average increase of 7.8% in salaries,
<br />but how they allocate funds by line item is entirely their responsibility. This in-
<br />crease in budget represents 36% of increased revenue projected from local sources.
<br />Percentage-wise this is consistent with this Commission's recommendation last year that
<br />approximately 35% of local revenue be allocated to the School Board operations.
<br />
<br /> As noted earlier General Fund Expenditures (excluding the School Board) increased
<br />approximately 2.36 million dollars. Of this increase, about 1 million dollars was in-
<br />curred from increased salaries and new positions since July 1, 1973. The percentage in-
<br />crease on existing salaries amounted to an average of 7.8%. Increases other than
<br />slaries amounted to 1.34 million dollars. More than this amount is attributed to in-
<br />creases in Contract Services, Fixed Charges and Materials and Supplies reflected through-
<br />out the budget~ The basis for these charges are administratively uncontrollable and
<br />highly sensitive to inflationary trends of this period. This means expenditures for
<br />equipment, maintenance and desired services had to be curtailed substantially. Another
<br />cost beyond local control was in required contributions to the Retirement Fund which
<br />grew by nearly $400,000. This is directly the result of benefit changes made by ordi-
<br />nance during the 1970-71 period.
<br />
<br /> Certain salaries on the management level have been increased more than the 7.8%
<br />average mentioned previously. This has resulted from organizational changes and pro-
<br />motions believed necessary by the City Manager for the implementation of a "Team Manage-
<br />ment'' approach. We concur with his organizational plan and believe it to be a highly
<br />needed improvement critical to an efficiently~operated city. It is not our function to
<br />judge qualifications of personnel holding positions, but we do believe that compensation
<br />necessary to the position should be paid if quality of performance is expected. Our
<br />comparison with salary levels in other cities of our size reflect, for the most part, that
<br />those salaries are reasonably in line.
<br />
<br /> Based on the foregoing, we believe the expenditures reflected in this budget to be
<br />reasonable and necessary. The ~2.60 tax rate and the mncrease in utility fees will bring
<br />the revenues needed for a balanced budget. We believe these recommended changes are most
<br />practical and reflect sound fiscal judgement given the economic situation we face. It
<br />might be noted that our taxes and fees will still remain in line with those of other
<br />neighboring cities, and will provide us with a normal expected rate of return on capital
<br />with respect to utilities.
<br />
<br /> While the City's budget is rather involved and complicated and the Municipal Finance
<br />Commission is only two years old, we do feel that our involvement in the budget last year
<br />and the many hours spent this year enables us to render a qualified opinion as to the
<br />proposed budget.
<br />
<br /> At our May 29, 1974, meeting we recommended support of the City Manager's proposed
<br />budget for 1974-75~'
<br />
<br /> On motion of Mr. Smith and seconded by Mr. Early, the following ordinance was approv-
<br />ed on first reading, and by the following vote:
<br />
<br />"AN ORDINANCE TO APPROPRIATE~FUNDS NECESSARY FOR OPERATION OF THE CITY
<br />GOVERNMENT FOR AND ~URtNG THE FISCAL YEAR BEGINNING JULY 1, 1974 AND
<br />ENDING JUNE S~, 1975."
<br />
<br />~Ayes: Early, King,
<br />Nays: Holley
<br />Abstaining: Johnson
<br />
<br />Smith, Wentz, Barnes
<br />
<br /> 74-230 - Motion of Mr. Smith and seconded by Mr. Early, to approve the following
<br />ordinance on first reading:
<br />
<br />"AN ORDINANCE IMPOSING AND COLLECTING TAXES ON REAL ESTATE, TANGIBLE PERSONAL
<br />PROPERTY, AND MACHINERY AND TOOLS WITHIN THE LIMITS OF THE CITY OF PORTSMOUTH,
<br />VIRGINIA, FOR THE PURPOSE OF RAISING REVENUE FOR THE SUPPORT OF THE GOVERN-
<br />MENT AND THE PUBLIC FREE SCHOOLS AND TO PAY INTEREST AND SINKING FUND ON THE
<br />PUBLIC DEBT FOR THE FISCAL YEAR BEGINNING JULY 1, 1974 AN~ ENDING JUNE 30, 197S,"
<br />
<br /> Motion of Mr. Johnson and seconded by Mr. Ho!ley, to amend the ordinance that the
<br />tax rate be roduced from $2.60 to $2.25, was defeated by the following vote:
<br />
<br />Ayes: Holley, Johnson, King
<br />Nays: Early, Smith, Wentz, Barnes
<br />
<br /> The motion to approve the ordinance on first reading was adopted by the following
<br />vote:
<br />
<br />Ayes: E~rly, Smith, Wentz, Barnes
<br />Nays: Holley, Johnson, King
<br />
<br /> 74-231 On motion of Mr. Smith and seconded by Mr. Early, the following ordinance
<br />was approved on first reading, and by the following vote:
<br />
<br />
<br />
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