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June 8, 1971
<br />
<br /> While the School Board requested an increase of $345,686 in local funds, we have managed
<br />to provide funds needed without any increase in local funds. The School Board estimates it
<br />will receive $418,400 in additional funds from the State and it is believed that it can meet
<br />financial commitments without any increase in local funds, which currently amount to $7,174,43
<br />It is to be noted that it takes 93% of the funds the City estimates it will receive from real
<br />estate taxes to cover local cost of the operating budget of the public schools.
<br />
<br /> Earlier in this message, I stated that we have separated the welfare budget from the
<br />General Operating budget. This budget includes our local welfare cost, $993,766, which is
<br />$44,163 less in local costs than incthe current budget. The proposed welfare budget for 1971-
<br />72 totals $10,672,973, representing an increase of $5,103,502, or a 92% increase over the cur-
<br />rent budget. With the State taking over 4 major categories of welfare on January 1, ~972, and
<br />a change in administrative costs, to 80~ State/20% local rather than the present 60%/40% ratio
<br />we initially assumed there would be a substantial reduction in local costs. This has not
<br />materialized due to the State requiring additional personnel in order for us to qualify for
<br />the 20% reduction in local costs. The welfare programs also have been expanded.
<br />
<br /> Tp meet expenses necessary for the operation of City Government, careful study and re-
<br />view was made of our current revenues, based on information from various City departments ale
<br />with what assistance we could anticipate from Federal and State Governments. The only major,
<br />additional revenue being anticipated in this budget from the Federal and State levels is an
<br />estimated $418,400 for school purposes.
<br />
<br /> The projection of our anticipated revenues reveals it would require an additional $1.5
<br />million of new revenue ~6~submit a b~anced budget. These new funds are necessary, since ther~
<br />was projected a net gain of only $554,157 in revenues over the current budget. This small
<br />increase is due to the temporary windfall created by moving the date on collection of personal
<br />property tax for 1971 to the month of June in the current budget. This requires us to provide
<br />an additional $1,750,000 in the new budget.
<br />
<br /> Creation of the one-time ~ndfall revenue last year was a desperation move to prevent the
<br />necessity for increasing real estate taxes and, in expectation that we would receive State and
<br />Federal assistance in time for the 1971-72 budget.
<br />
<br /> Since help for the cities did not materialize, we now are compelled to raise in new re-
<br />venue the $1.7 million gap created. Were it not for that situation, the proposed fiscal budge
<br />could have been balanced without any new sources of revenue.
<br />
<br /> To attain revenue requirements, careful consideration was given to every possible avenue
<br />of new funds and avoid increasing real estate and personal property tax rates. To meet oper-
<br />ational requireman~ for fiscal 1971-72, it is believed that the following sources are the most
<br />equitable methods of raising the revenues:
<br />
<br />Trash and Garbage Tax $800,000
<br />
<br /> This is pro3ected on the basis of $2.00 per month, per dwelling unit. There are 36,475
<br />dwelling units in the City, according to the 1970 census, with:.a vacancy ratio of.5.4%.
<br />
<br /> The service charge wauld be equitable on the basis of services provided for residential
<br />property. In ad-dition to trash and garbage collection twice a week, the following s~ecial
<br />services were provided in the past year:
<br />
<br />(a) From A~ril, 1970 to March, 1971 the Public Works Department hauled 4,578 loads of
<br /> bulky refuse from residential property at no cost to ~wner.
<br />
<br />(b) During the same period, the department hauled 475 loads of chipped tree limbs, which
<br /> is equivalent to 1,900 bulk loads of brush and ~ee trimmings. Total truck load
<br /> volume for Public ~orks was 6,478.
<br />
<br />(c) 'The Parks Department hauled 540 truck loads of logs and limbs and 618 truck loads
<br /> of trash and debris fDr a total of 4,158 truck loads. Most of the trash and debris
<br /> was from residential propert~ as were some of the logs and limbs.
<br />
<br /> Also, this service fee would be chargeable to all non-taxable property as well as rental
<br />property.
<br />
<br />PMbperty R~nlgt tic,naB Tax - $175,000
<br />
<br /> This estimate is based on a license fee of ~10.00 per unit, plus 1% of the gross receipts
<br />This will apply to every person engaged in the business of renting residential property (2 or more
<br />units) iicluding houses, apartments, and dwelling units, or business property including pro-
<br />perry used for commer¢i,al, manufacturing or industrial purposes.
<br />
<br />Lodging Tax $2S,000
<br />
<br /> This is calculated at a tax of 25¢ per room~ per,~day~ There are 375 motel and hotel rooms
<br />in the City.
<br />
<br />of 3% tax on the sale of food within the City of
<br />the City that did a gross business~ $8,283~220 last
<br />
<br />Restaurant Food Tax $210,000
<br />
<br /> This revenue is computed on the basis
<br />Portsmouth. Ther-e~ are 139 restaurants in
<br />year.
<br />
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