Ocean View council approves budget without tax increase
The residents of Ocean View will not have a town tax increase this year, after the town council unanimously approved its 2018-fiscal-year budget at its Tuesday meeting with no tax increase involved.
The budget approval came following a final budget workshop last Thursday, April 6, at which the council reviewed its fifth budget draft for the year.
“First and foremost, it’s our job and duty as a town council to produce a responsible budget, one that seems to keep within the reasonable ability of the taxpayers to financially support. Everything else is secondary to that premise,” said Mayor Walter Curran at the Thursday workshop.
But Curran said the future growth projected for the town is limited, and the Town needs to plan for the waning of real estate transfer tax revenue.
“That gives us reduced revenues and essentially a finite population… Given those two factors, we recognize that Ocean View is a small town.”
Curran also addressed concerns that the Town’s police department may be overstaffed.
“People have said we have a disproportionately large police department. That’s not true. We have exactly what we need because this council and prior councils said we absolutely want 24-7 coverage.”
The revised budget draft included salary adjustments for employees, which had been discussed at a previous meeting.
Earlier this year, the Town reviewed a compensation survey completed by consultants Hendricks & Associates (who also conducted a full salary study for the Town in 2012), which found the Town’s salaries to be below market comparison.
In Hendricks’ most recent presentation to the council, the consultants recommended allotting 6 percent of all employee salaries to make appropriate adjustments to the salaries of those employees whose compensation falls below the mark.
The Town’s personnel costs account for 70 percent of the Town’s budget, which he said is not a bad thing.
“It is what it is,” he said, noting that the Town is currently understaffed by one person in the maintenance and administrative departments, with staff looking to streamline work.
“It’s very common for service-type industries to have about 70 percent of their budgets go to salaries,” added Finance Director Sandra Peck.
With the council focusing on salary adjustments this year, Curran said they were merely trying to fix a perceived wrong.
The council met with all department heads prior to the workshop, to discuss the performance of employees and the salaries they believed should be raised. Once adjusted salary was agreed to for an employee, a new salary midpoint was calculated.
Peck said the adjustment to salaries was $93,460 in all, noting that raises ranged from 3.3 percent to 24.8 percent.
“Two out of 22 employees are not recommended to receive a salary adjustment — only the merit, due to being at the proper placement in the range… Four out of 22 increases are in excess of 22 percent.”
Peck added that she wants to come back to the council after budget season to discuss the Hendricks method.
“As with any salary administration, not one of them is perfect. Not one’s liked by all… I can poke holes in and argue the pros and cons of any plan out there. That said, this is what we’re using today.
“I would like to be given time after the budget is passed to continue to get comfortable with all of the aspects of the aspects of the Hendricks method. I’ll then come back, share my opinions — pros and cons — and any recommendations I may have.”
Peck said it is also very important for the council to start the budget process earlier in the year.
The council asked Public Works Director Charles McMullen and Police Chief Ken McLaughlin how they felt about the salary adjustments.
“Am I completely happy with everything? No, nobody’s completely happy with everything” said McMullen. “First off, I’d like to thank all of you for undertaking this… You’re trying to pick up and take care of the sins of the past.”
McMullen said that he hopes that if Peck determines that something else could’ve been done, the council will take action.
“I walked away from the table thinking they gave it their best effort,” he said.
Councilman Frank Twardzik asked if McMullen’s employees will be happy with the salary changes.
“In all honesty, I think my people are going to understand what I tell them… Will they be totally happy? No. I think they’ll be appeased. Some of them will be extremely happy.”
“The study didn’t fail us. We failed the study,” added McLaughlin. “The employees were well aware we failed it once, failed it twice. I think, to be honest… it would’ve become an issue as far as retention goes.
“I’m hoping that we’ve got a handle on this so I’m not going to have to be worried about replacing staff in the coming years.”
The Town’s five-year outlook listed drainage projects as unfunded; however, those projects will be added once easements are acquired. Monies will be found to make those improvements, and the council can vote on a budget amendment.
McMullen asked the council to consider a drainage trust fund, similar to the Town’s Street Repair & Maintenance Trust Fund, so the Town could be saving for those repairs and future repairs.
Projected in the 2019 fiscal year is a 10 percent tax increase, which would bring in an additional $138,188 to the Town’s coffers. Peck broke down the figure, stating that, for a home assessed at $300,000, that increase would equate to $49.56 per year, or $4.13 per month.
McMullen added that, if long-term tax increases are necessary, he recommends the council look into a larger one-time tax increase.
“I find it better to be hit in the head once with a 100 percent tax increase than to get kicked in the shins once every year.”
“I think that’s very sound logic,” responded Curran. “You’re right on target. The 10 percent we have now, when we look at the dollars and impact, it’s not a lot of money. But, worse than that, it’s not a lot of money to help us fix our problems. The answer is, we’re going in that direction, but that’s for discussion starting early next fall.”
At the April 11 meeting, the council voted unanimously to approve the annual operating budget for the 2018 fiscal year, as well as an ordinance to establish the Five-Year Capital Improvement Program.
Also at the April 11 meeting:
• Gary Meredith resigned as chairman and member of the Ocean View Planning & Zoning Commission, due to health reasons. The Town has received a letter of interest from Steve Micciche, who has actively served the community in a variety of ways, including in the CAP program and as a Millville Volunteer, and served on Country Village’s Board of Directors.
• McLaughlin noted that the department will be hosting a state-wide training seminar at Bear Trap Dunes on April 18 and 19.
• McLaughlin said he had met with DelDOT officials regarding the Ocean to Bay Bike Tour on April 29. Central Avenue is usually part of the tour’s route; however, due to a pipe failure last month, part of the roadway is closed.
“They indicated it will not be done by the end of the month or several weeks after, weather dependent.”
• The Town was recently recognized as a 2016 Tree City USA by the Arbor Day Foundation.