SB Budget Update April 16, 2008
It looks like the Town Council cut another $500,000 from the budget at a workshop on April 15. Here’s the article from Portsmouth Herald:
South Berwick trims budget
Portsmouth Herald
The Town Council worked with department heads Tuesday night to find an additional $500,000 in budget cuts, bringing the fiscal 2009 year budget request down to a level they hope residents can live with …
Tags: budget, so. berwick government, town council
April 16th, 2008 at 7:29 am
With the additional $500,000 cut Tuesday night, that must make close to $1 million in reduced spending since South Berwick’s budget crunch was revealed this winter. This process has been very tough, and given the economy, there are doubtless more hard choices ahead for all towns. But during this past month the town council, acting town manager Roberta Orsini, and the department heads have worked hard together, and are getting results that are truly commendable. They all deserve our thanks.
April 16th, 2008 at 7:44 am
No one said this wasn’t hard. The point is now that the Town Council has to face the fact that we can not afford many of the salaries and programs in place. We simply can not afford it. Moreover, the longer it takes for the Council to face the fact that salaries need to drop and benefits reined in, the harder this will be in the future. This morning oil is at $114, and the dollar has dropped to new lows. The ripple effects of this — while they seem to be intense right now — haven’t even really BEGUN to kick in. By fall, the situation we’re in today will seem like the good old days.
April 16th, 2008 at 10:06 am
You understand the cost of oil and everything else going up, and believe that salaries need to drop; does that mean that your salary and benefits should drop also?
April 16th, 2008 at 10:11 am
SD,
Since my company is forcing me to pay for more of my benefits, in effect, my salary has dropped. I have less take home pay than before.
I’m not asking for anything more than what is happening elsewhere.
April 16th, 2008 at 10:42 am
I’m not sure dropping salaries is what needs to happen. Salaries just need to be held at current rate, OR have the COLA adjustments, OR have the merit increase. That isn’t dropping the salary, that just means those employees will have to tighten their belts like the the majority of employees out there whose companies provide fewer benefits, and fewer raises. Why is that not a reasonable solution?
April 16th, 2008 at 11:20 am
What you guys are missing is the sense of real bottomline business here. If you view the Town as a business, its customer base is now experiencing tough times that are going to get even tougher in the months ahead. What does a responsible business do to remain solvent in this case? It cuts workers. It cuts back on benefits for its workers. It drops salaries. It scales down future plans. Ultimately, it drops prices or holds them stable for its customers. It does NOT increase salaries or benefits and then, raise prices for customers. Raising prices or taxes in this case will damage the customer/taxpayer base.
The taxpayer is not an endless source of funds. You do come to a point where raising prices or taxes produces a negative rather than positive rate of return. Which is where we are now. Raising taxes to accomodate even a cost of living raise for employees is nuts — it will produce foreclosures. It will produce more home sales at lower prices. Lower house sale prices will reduce appraisals. Which, in turn, will reduce tax revenues. And put the town deeper into the hole.
Rather than even considering a tax increase at this point, the Town Council needs to take a chainsaw to the budget and hold taxes stable. That will help home prices stablize here, and lessen pressure on our residents. Moreover, a lower tax rate will attract more homeowners and businesses.
Raising taxes now is going to put a bullet thru the hearts of most of our residents making under 50K per year. Note that this morning, oil and gas inventories DECLINED. Gas will now, without any question, be over $4 this summer. Heating oil, we don’t even want to discuss.
April 16th, 2008 at 12:18 pm
KC I could not agree more, the town is a business and should be ran as such. Having been in a situation as a department head in a company that came back from bankruptcy, the recovery requires a well thought out plan and the ability to curtail spending. The proposal of giving all town employees a cost of living increase is insane giving the current state of the economy. I currently work for a company that has offices world wide. And they are putting a freeze on all cost of living increases for this year company wide. Why, so they can possibly retain the work force with out making cuts.
It also seems to me that our elected officals did not listen to the people of the town at the meeting on the 14th. In todays Fosters there is a headline that states they are going ahead with the Saint Michaels purchase for over 800K. I find this unbelivable that they are proceeding with this after the meeting. Not only do I not think the town can afford the building, but it also brings up the question of what is it going to cost to heat every year at $4.00+ a gallon for heatng oil, what is the cost going to be to make the required structural changes to actually use the building for its intended purpose.
I truly believe that they need to get a grip on reality. If there is a tax increase, how many people in town is this going to be the last financal straw in there ability to maintain there homes. I wolud imagine that there are many that are just barely making ends meet. You can tax all you want but if people have not got it it does not do the town any good and just adds anouther piece of property to the town inventory.
April 16th, 2008 at 1:00 pm
Going thru with the purchase of the church is just lunacy. One of the Fed governors just said real estate prices are going to continue to fall >>> and may fall further than anyone currently expects. Not only are they taking a property off the tax roles, they are buying at a premium price.
That said, let’s put this in more tangible terms. Say it costs 15K to heat the place next winter. Now, if the average tax bill is projected to go up $350, that means that the increase from 43 families are going to be going solely to heat this building. Average income in the town is about 40K, which after federal and state taxes leaves take home in the range of about 33K. This family pays a mortgage — let’s say they are a responsible family, and didn’t take an adjustable so their payment is 900 bucks a month, that’s 10.8K per year. They also have a car which costs about another 300 (3.6K) bucks a month to put gas in and keep insured. They like to eat, there are three of them, so its about 100 bucks a week. (5.2K). They like to stay warm, and that’s costing a lot more …. about 2.5K per winter last year because they didn’t have the cash to put down to seal in a price in June. They need to clothe their child, so that’s about 600 bucks per year. And then, there are credit card bills and, if they are young, college loans they are trying to pay off…that takes 500 per month. And there are their real estate taxes which are currently 2500 per year….
all of which totals 31.2K ….and leaves them a grand total of 1800 bucks of “fun money” for medical and emergencies. But, that’s really just 1500 cause the town wants 300 dollars more from them to heat the white elephant it bought at an inflated price.
That’s my point. We have to look at this all in terms of what this means for the town’s people. Employees shouldn’t be paid “what other towns in Maine pay”….The thinking, rather, should be “there are X jobs at town hall, they pay X because this is what we can afford to pay without causing our townpeople serious pain and endangering the long term viability of the town.
Going thru with this purchase at the current price, there are no words. It is a serious case of people working with OPM (other people’s money) and having very little concern about the actual impact of their decisions.
April 16th, 2008 at 1:07 pm
I don’t believe that churches pay property taxes, do they?
April 16th, 2008 at 1:09 pm
If we take the property off the tax rolls, there are no taxes. If some other organization “snaps up this bargain”, they will.
April 16th, 2008 at 1:40 pm
KC-You are welcome to your opinion about the church but I have another view of the purchase of St. Michael’s. I think that the Council would have been severely negligent if they let this pass them by. The property is in a strategic place to help with downtown parking and traffic circulation, and it provides opportunity for the future for library development, senior housing and who knows what else. If they didn’t move to get this property now, in a few years they would be paying far more to try to address the parking and traffic issues in order to keep businesses downtown, not to mention the need for senior housing. It’s kind of like sending your kid to college during tough times, it will pay off many times over in the future. I am happy they had the courage and vision to do this. I think in twenty years people will be looking back and saying how smart they were to do this.
April 16th, 2008 at 1:49 pm
My point, Molly, is not that they shouldn’t buy it, but that they should not buy it now for the current price. Any real business would have looked at the appraisal, and immediatly re-opened negotiations. It is irresponsible not to, and to get that price down in line with the new number. Moreover, it is going to be very expensive to insure the building for a dime more than it has been appraised at.
Bottomline, its a lousy deal. The building is fine, the long term plan is fine. But we are dramatically overpaying for the property now. This is not the bottom of the real estate market >>> far from it. We have another 20% or so to go. Plus, was there any serious competing bid from any other organization? NO. Very simply, the town could have negotiated a “first option to buy” for the next year or two years at a very attractive price. That would have given the town the option to meet any bid that came along in that time.
And, as a business person, I can tell you, ain’t no bids coming along from anyone else in their right mind at more than the appraisal in this market. What’s the rush?
April 16th, 2008 at 2:06 pm
Actually, I heard from a member of the church.
There was a possible bid from someone looking to develop the property.
In that case, and since the towns people voted to approve the bond to purchase the propery several yaers ago, it does make sense to purchase now.
At the budget meeting I got the impression that the last several budgets had already included what would be the payment for the bond, so that payment is not included in the proposed tax increase for this year.
The money from the past several years was supposedly put into an account to be used against the purchase.
April 16th, 2008 at 2:16 pm
It would be interesting to know how serious that bid was, and if it is even still possible, given the tightness of credit. Most of these “developers” have evaporated over the past several. Very few financial institutions are now willing to make loans to developers.
Moreover, even if the money has been put aside, it still makes absolutely no sense whatsoever to go thru with the purchase at an inflated price. Put aside or whatever, the cash has come out of the taxpayers’ pockets and deserves to be treated with respect.
The deal should be re-negotiated. If it can’t be, stand aside and wait a few months and reapproach the church when they are more realistic about the worth of their property.
Saying that this is like paying for a kid to go to college now to reap the benefits later doesn’t fit this set of circumstances. If you want to put it correctly, what you are actually saying is, I’m going to pay the college 20% more than the current tuition because that is what the value of the education may be to me some day.
Again, the town is asking people to bear a great deal of pain — they owe it to taxpayers to treat their money with respect. Not cavalierly. We should pay the church what the building is worth NOW, TODAY. Not a price based projected value to us some day. That’s an inexperienced buyer speaking.
April 16th, 2008 at 2:22 pm
I’ve heard various tidbits and rumors about what went on behind the scenes but nothing I know certain enough to repeat. Maybe I am naive, but witnessing that part of the meeting I really trusted that council members all felt strongly that they were doing the right thing. Every single council member spoke in favor of the purchase and, even though as we’ve seen over the last few months they tend to look at things from different viewpoints, they were completely unified on this. I know they are not stupid and I have complete faith that they all try to do what they think is best. From watching them I know they are frugal, and like many of us New Englanders, some of them may be frugal to a fault, so I don’t think they would vote on something like this lightly.
Dave, you are right, the money for the purchase comes from the bond and from money already set aside for the library. I’ve been interested in the library building project for some years now and it as been so frustrating to see construction costs steadily rise over the time the library has been stalled. The money and the bond we have now could have built a new library back when plans for a new library first started. I am so happy that this locks in something for a library and means we can go out and seek grants to do some renovations.
April 16th, 2008 at 2:23 pm
I believe they did renegotiate down from the original 1.1 million.
The current price is $875.000
April 16th, 2008 at 2:27 pm
Molly,
No one is saying that the Town Council is stupid. Most people are not seriously in economics or the macroeconomic landscape, nor are most municipal authorities hard-boiled real estate negotiators. Bottomline, there’s no competition for this property. We’re apparently going to pay well over the appraisal price, which is overpaying.
Paying an appropriate price for the property would save you some 20% of the bond money — which could give you even more money for even more dramatic and valuable renovations and upgrades.
Its a bad deal. Just because we can buy it now doesn’t mean its a good deal. And I am a very big supporter of libraries. 20% more money to spend would mean the world in terms of giving the town a 21st century library. A lot more.
April 16th, 2008 at 2:31 pm
One more thing, inherent in all of this seems to be the running theme that all real estate goes up long term. And over the long term of the past thirty years, it has. Dramatically so in the last five years. Things began to noticeably turn down last summer. But we have a long, long way to go to return to the “mean” price in terms of prices coming in line.
There’s an anxiety about this purchase due to this idea — if we don’t get it now, its going to cost more next year. Well, truth? Well, no, it isn’t. Right now, as I type, two Fed governors are going at it at a luncheon and both are saying they have no expectations of an upturn until late 2009, and it is going to be a very slow comeback.
April 16th, 2008 at 2:36 pm
I hope we get to find out at some point what went on behind the scenes that made them decide on making the offer at that price.
I was more thinking about what the potential cost would be if they don’t get that two acre parcel now and then have to buy up individual parcels in the future to make a parking lot, a back road to the school or whatever.
April 16th, 2008 at 2:38 pm
Whatever they want to buy will be much cheaper next year. It just came over the wires that one of the Fed’s governors has just said that credit is expected to be much tighter and is expected to decline for businesses in the months ahead.
April 16th, 2008 at 2:46 pm
Hmmmmm. Is that why the stockmarket went up 2% today?
April 16th, 2008 at 2:55 pm
Bill, you really want to get into that? At this point, with the dollar deteriorating at the speed of light and property values falling, there are very few outlets left for people to preserve the value of their wealth. Their purchasing power. So we’ve got a sort of stumbling run to the multi-nationals with the idea that they will continue to keep on keeping on. And commodities. That said, there’s also something going on with our government and Mr. Bernanke. They are printing cash at the speed of light to hold up the banks…..and some believe to hold up the markets as well.
I’m a day trader who does currencies and indicies. Oil closed at 114.8
April 16th, 2008 at 3:03 pm
So what should we do? Buy gold and barter for food?
April 16th, 2008 at 3:27 pm
Hard to say. Pay off all your debt that’s for sure. Don’t get sucked into this market mania cause there’s nothing underneath and the first big bank that is too big to save is going to take it all down. Oh, and don’t buy real estate now…laughing.
April 16th, 2008 at 3:28 pm
A couple of questions: How does housing books or the elderly increase the town’s tax base? What revenue will the town realize…late book fees or the town become landlords collecting fixed rents on an older building that could potentially be a maintenance nightmare? I’d really like to know before I formalize my opinion.
April 16th, 2008 at 3:48 pm
One other thing would be the school Budget that has gone up 26% in the last two years? When will this stop! All we look at is the town portion getting below LD1. They need to look at their salary pay outs.
April 16th, 2008 at 3:58 pm
Diesel fuel (like the kind the busses use?) has gone up 65%.
April 16th, 2008 at 4:05 pm
I bet everyone voted against TABOR,it’s not looking so bad now.
April 16th, 2008 at 4:07 pm
No. TABOR still looks bad.
April 16th, 2008 at 4:10 pm
TABOR was a horrific plan. Senseless cutting as opposed to intelligent planning and budget restraint that could be instituted here.
April 16th, 2008 at 4:21 pm
Hey KC- you and I are in total agreemeent on TABOR. I can never understand why people are willing to give up control to something like TABOR.
April 16th, 2008 at 4:23 pm
Unfortunately, it doesn’t look like the Maine State Legislature will ever exercise intelligent planning and budget restraint.
April 16th, 2008 at 5:05 pm
Nor will the town it seems. We are heading for a world of hurt if they raise taxes. The head of JP Morgan said today that he doesn’t see housing showing any strength or the economy rebounding significantly till sometime late next year.
These guys should be planning on how the Town is going to work to maintain the foreclosed properties. The RTC, the entity that held properties in the last downturn, was none too strong on this front.
April 16th, 2008 at 5:18 pm
When I went to my first town meeting in March, I said that they would be facing an empty town if they don’t get the budget under control.
The problem is, they can get it under LD1 and we could still have an increase because of the school.
April 16th, 2008 at 5:20 pm
Let me throw out another word you tax and spend liberals don’t like “Republican”.
April 16th, 2008 at 5:24 pm
Well Ken, I don’t believe anyone has ever considered me a liberal.
April 16th, 2008 at 5:32 pm
Excuse me, and i don’t mean to start a political firestorm here, but we are all in the state we are currently in due to the unbelieveable spending policies of the past eight years. The deficits and trade balances are now so high that the government in cahoots with the Federal Reserve are now trying to “inflate” our way out of the situation. That is what is causing the intense spike in oil prices & other commodities. Not demand. Demand is increasing, but it has not increased 40% over the course of just the past year.
Of course, no one is going to say this on CNBC, and you certainly aren’t going to hear this from the Bush Administration. But I trade these markets, and that, bottomline, is what is going on. Brought to you all courtesy of the “fiscally responsible” party, the Republicans.
April 16th, 2008 at 5:58 pm
How did Clinton reduce the deficit?
http://www.clintonmemoriallibrary.com/clint_deficit.html
April 16th, 2008 at 6:05 pm
Dave I obviously wasn’t referring to you but I was commenting on the majority of the other bloggers and the state of the State.
April 16th, 2008 at 6:10 pm
A few facts.
Clinton, say what you will, whatever his plan, his “surplus” was, he did maintain and strengthened the value of the US dollar, which in turn, provided strong support to the economy. And that, bottomline, is critical. Now…..
At the start of the Bush Administration, the US dollar was worth 1.2 Euros. Today, it closed the NY session at .713 to the Euro. That a decline of 40% in purchasing power in the world markets over the past eight years.
This happened because the “surplus” or dollar strength that existed at the start of the eight years was exhausted after the first two years and the dollar started to decline. After that point, borrowing was the means of expanding any policy. That included everything from the war in Iraq, to the bailing out of banks, to the money for the “stimulus” checks that are coming in the next couple of weeks. Now borrowing is interesting — essentially the Fed creates money as it sells bonds, which are certificates of debt. So right now, with things rolling along, our money supply has been expanded dramatically over the past couple of years. Its been particularly acute lately. Its estimated that its been blown out some 20% in just the last nine months.
I say estimated because just as Bernanke took over two years ago, the numbers were getting bad and were clearly on the path to worsening, and our government decided not to publish them any more.
Anyway, demand for commodities and energy is growing, but not at the price that they are increasing. No, the producers — the oilmen, the farmers, the miners — they just want to get the same purchasing power for the goods they are producing. Its really that simple.
Moreover, it is now really that bad. Now dollar is clinging by its fingertips to what currency traders call the .71 “handle”. If it falls below this level, which it looks like it may very well do tonight, it could go into freefall. Which is why oil is going to the moon now. And the other commodities had such a strong day. And why our government and others around the world are talking about intervening in the currency markets.
What’s fascinating to me about all this is how if you bellow something long and hard enough, like “tax and spend liberals”, you can get people to believe it. Believe it so thoroughly that they vote for politicians and policies DIAMETRICALLY opposed to their own interests.
April 16th, 2008 at 6:46 pm
Actually KC, I had to cut that post short to attend to some work.
Chris matthews (who I don’t usually listen to because he’s too liberal) (and Bill Orielly is too conservative) any whay, Chris Matthews put it very well in an interview.
He basically stated that for the past thirty plus years, congress has accomplished very little because neither party wants the other to get credit for doing anything good.
Both parties will reject measures that don’t go fully the way they want.
Instead of adopting something that will go at least part way, and offers some assistance and positive changes for the American people, they would rather have nothing.
If both parties would get together and at least work on the common grounds, then there would be a start of something that could be built on
Does this plan fully solve the health care issue? no, but it goes part way, so lets adopt this part and work on the rest later.
if both parties would work like that, alot of these problems would have at least partial solutions.
I was not trying to put any blame on any one party, just provide an example that both parties have failed us.
April 16th, 2008 at 7:30 pm
So, under the current budget, how much will the tax rate increase? It was first at 26% and then at 18%. I haven’t heard a report of where it stands now.
April 16th, 2008 at 8:19 pm
Dave, at this point, the party that appears — in reality and based on the plans presented on the various websites — to be the most fiscally responsible looking ahead is the Democrats. The financial people creating the plans for Hillary are okay and well respected….they will competently manage things and not start any new fires. Obama has the serious power players (Paul Volcker, etc.,). These are the people who talk and wall street and financial people worldwide listen.
McCain’s financial advisors are, to put it bluntly, walking disasters. They are the gang responsible for the second failure now of supply side economics, the complete and reckless disregard of regulations on the banking industry and the removal of many of the safeguards on the commodities markets. If you want to pursue the current policies right into the ground, McCain is your guy. He’s just extending Bush’s group’s reign of terror.
Obama’s crew of advisors pulled us out of the tailspin the last time (post Regean/Carter)…its a lot to ask for a second miracle. But if anyone can do it and, most importantly, has the strength of character and the cred worldwide to do it, its Paul Volcker.
And Mike, the number currently being bandied around is 18%. Still way, way too much given current economic realities.
April 16th, 2008 at 10:00 pm
The 18% was reported before the additional $500,000 reduction in the budget by the Town Council yesterday. I would expect that the tax rate increase would be less than 18% now. Unless there is something that I am missing.
April 17th, 2008 at 3:18 pm
Do we know if they addressed the salary and benefits situation? It seems truly obscene to be paying the town manager such an inflated salary, as well as the raises & benefits for the employees. Those have to be substantially cut back. We shouldn’t be putting people at risk of losing their homes to pay salaries that are way, way out of line with current economic reality.
April 17th, 2008 at 5:01 pm
According to the Herald article
Councilors decided to delay the medical benefits issue until it could be discussed more fully at the end of the year in preparation for the next budget cycle.
April 17th, 2008 at 7:31 pm
I do hope that they have decided to pass on the “merit” raises and the COLAs. Given the stats, I’d be willing to bet that less than 5% of the people working in South Berwick have seen cost of living raises. Its difficult to imagine justifying this, when the guy living next door to any one of the employees may lose his house to pay for it.
As I said, there’s quite a bit of spending going on here with an OPM (other people’s money) attitude.
April 17th, 2008 at 7:42 pm
The town employees get 100% health benefits and some of their neighbors will qualify for Baldacci’s Drigio Health Plan.
April 17th, 2008 at 8:26 pm
Both on us!
April 17th, 2008 at 9:14 pm
I just wanted to let you all know that the town is not the only one that will pay 100% for someone’s health insurance.
The school distict will and does also pay the 100% for a single subscriber. So if some one was thinking straight they would have the district employee take the health insurance through the district at 100% and maybe have their better half pay for the rest of the family.
An when you talk salaries just take a look at the top three or four salaries of the school district. Just between those top three or four, you are looking at between 300.000 or 400,000 in salaries.
Just a something to think about, If you are going to cut then lets cut at that budget also. (But some people do not want to bring up that can of worms.)
April 18th, 2008 at 7:53 am
From what I understand was said at the last meeting, only the emplyee is covered at 100%, they already charge for the family plan.
That being said, the emplyees also should bear some of the cost of their own insurance. Yes, the school budget needs to be questioned as well.
Unfortunately for me, they generally have those meetings when I’m still at work, so I can’t attend.
Maybe we can push for them to hold the meetings later so more people can attend and let their voices be heard.
There is no reason at all for the school board to have added the housing supliment to the superintendents contract.
Their reason for it is because houses are more expensive here.
The housing is expensive for ALL of us.
I’ll bet the gentleman in question did not have as large a salary where he last was either.
Find me one company that provided a housing allowance because houses are more expensive than where you are moving from.
April 18th, 2008 at 10:44 am
Well, my thought is that we consider that the average tax increase is going to be about $350-400 bucks……take every one of these “luxury” items like the employee raises, the housing supplements, the overly generous salary for the town manager, the nonsense things like the unnecessary phone upgrades at town hall. Take each one, divide by 400 bucks and figure out how many families are going to be hurt. Out of that, estimate that one or two will be pushed over the edge and lose their homes (yes, the situation is this tenuous for many more families than anyone wants to admit)……and then decide what the foreclosure rate will be for the town. If we can live with a foreclosure rate between 5-7% and the resulting decline in property values, so be it.
That said and that done, we also should then begin setting aside cash to maintain the foreclosed homes. While this is a bank responsibility, in my experience, its not one that they take terribly seriously. We will also need to increase the amount budgeted for the Assessor as with the steep decline in property values that this all will cause will then trigger a huge demand for re-assessments.
Every action has a reprecussion. Making a mistake here and steeply increasing taxes is going to have ramifications >> more than likely pretty bad long run ramifications. For instance, $23000 for upgrading phones will impact 57 families. Four or five could be pushed over the edge. One or two or even three might lose their homes.
Properties surrounding the foreclosed properties will drop in value. And the owners will want to be re-assessed. Refuse to assess and you get legal bills and a case you probably can’t win. Re-assess and the neighborhood next to that one wants re-assessments………and ultimately, your little “nothing” phone upgrade ulitmately costs the town well over $100K in the next two years.
And puts us deeper in the hole.
Are one or two missed phone messages at Town Hall this important? Is paying a clerk more than any private industry clerk in 100 miles makes this important?
April 18th, 2008 at 12:15 pm
I think it is time we all realize that this area is no longer ‘one of the most expensive areas’ to live in as it once might have been. Many areas are expensive all up and down the eastern seaboard. I can’t believe we are giving a housing allowance to someone who probably makes a pretty decent salary. If So Berwick and Eliot are too expensive, do what many others have done and live in Berwick, North Berwick or Sanford. That is precisely the kind of ‘extra’ that needs to be cut, in addition to what others here have suggested as well. The few companies I’ve seen that give housing allowances, give it when people are moving to a truly high cost of living, like Hawaii or California. And, while the school district and the town need to be fiscally responsible, their ‘business’ rides on the backs of taxpayers. So I see them differently than I do a traditional business. At some point, people will feel that enough is enough, no more extras.
April 18th, 2008 at 12:23 pm
I will agree that there are some upgrades that could be held back on for a short time.
But, Im also saying that we should look at the school department to take a closer look at their budget.
The head of Maintance for the district is given a district owned vehicle to take home at night (Exeter N.H.). An the district is probably paying for the gas for that vehicle.
April 18th, 2008 at 12:44 pm
I happen to know that the head of district maintenance lives in Eliot.
April 18th, 2008 at 12:47 pm
Kc-You have your opinion and you are entitled to that. However I don’t want you or other people who read this blog to think that that’s what every one in town thinks. I have a very different thought about what is happening. When I hear that a tax raise of $350-$400 might push some people over the edge so they will lose their homes, my outrage turns to the inadequate energy policy in our country, the oil companies whose profits keep rising, the corporatization of health care that funnels money that used to go from patient to health care provider off to insurance companies and corporate hospitals with ever-increasing profits and executives with multimillion dollar salaries, and the mortgage lenders whose reckless and exploitive lending practices have jeapordized millions of families’ homes. That’s where I choose to turn my righteous anger, not at the public servants who live and work in my town.
I don’t think we are passive customers of our town. I think of myself as a shareholder in our town, and as such I have a stake in making sure the town runs well and cost effectively and to make sure that we hire and retain good staff to keep it running well. I feel that I get an excellent return on my investment (my taxes) in this town. It is a good place to live, town employees are responsive and hard working, services are good. Our taxes are not out of line with other similar towns. The people who work for the town work very hard, many go to meetings several nights a week. They also have to endure people standing up in meetings insinuating that they are trying to take advantage of tax payers and all manner of accusations. You couldn’t pay me enough to do their jobs. Many of the people who work for the town could make higher wages in the private sector.
I agree with you that the economic picture is causing pain to people but I don’t accept that local taxes are the major cause of that pain.
April 18th, 2008 at 12:57 pm
It’s the Director of School Facilities that lives in Exeter.
April 18th, 2008 at 1:19 pm
Molly is right on. We are going to pay local taxes. With the pared done budget the Council is coming to, the tax rate will compare reasonably with other communities that suround us. Sure, increased taxes are a burden, our tax burden will not be unusual.
I once heard a good description of proponents of a “cut taxes at all costs” attitude:
They know the cost of everything, but not value.
Let’s keep taxes strongly under control, but let’s not lose the recognition of the value of what we are paying for.
April 18th, 2008 at 1:19 pm
Dave,
You are right it is the Director of School Facilities ( they use to call that position the Head of Maintance).
Molly,
And I do agree with what you are saying, a lot of the strain put on families right now dose come from out side our little neck of the woods. And we do have great employees and out standing services.
Until they big wigs in Washington take a strong stance on what is going on in this nation, it will always be the little guys that get hurt.
And all Parties (both dems. and rep.) are responsible.
April 18th, 2008 at 1:20 pm
Excuse me, but I’m not saying this isn’t a fine place to live — and I’m also outraged by the oil companies and the situation with the health insurance industry. I’m also horrified by the Administration that continues — despite CLEAR EVIDENCE OF FAILURE — to pursue supply side economics to the absolute detriment of this country and our future.
That said, my point is that now we are on our own. We need to protect our town. We need to protect its value. We need to prevent a series of cascading events like a wave of foreclosures and a resulting decline in property values. We should not be adding fuel to the fire by increasing the budget with raises for employees. Very simply, it doesn’t matter what clerks are paid in other towns, we have to think about what we can afford. We can not afford raises. Given the environment, we’re not going to see the town employees walk out……where are they going to find new jobs? And even if they did, given the employment picture, we would find a line of people ready to take over. So here, we can not afford the salaries, and we can afford to take a chance that we will have qualified people filling the functions.
When you say many of these people could make higher wages in the private sector, I ask where? Do you know how bad the environment is now for white collar workers?
I think you’re getting emotional and defensive about what should be very cut and dried. Its pretty bottomline here. These are hard times that are going to get harder. Oil is now trading over 115. The implications of this haven’t begun to impact us yet. Not even really begun.
So, we forego making serious cuts in the budget amd raise taxes, we take the risk of triggering foreclosures and dropping property values. Ultimately revenues drop hard.
We keep taxes the same, we are still going to see some foreclosures, but property values remain more or less stable and town revenue remains stable.
We cut taxes, we attract refugees from surrounding towns, property values increase and tax revenues rise — and then we can afford everything we can’t afford today.
Optimally, we should try to get taxes as low as possible to capitalize on the environment we see ahead. And, you know, if the Town Council did do the right thing, South Berwick could really take off. Because it is a beautiful town.
Every action has a reprecussion.
April 18th, 2008 at 1:21 pm
Bill,
I agree with that statement!!
April 18th, 2008 at 1:37 pm
KC, the stock market is up almost 3% today. 5% for the week. Tough times? Sure. But I don’t see the doom and gloom you describe. Cycles, yes, but not the “cascading events”. Some say the worst is not far away, we wil re-align, and proceed. You may be a day trader, you may be attuned in ways that I can’t understand. But the dire predictions I just don’t buy.
April 18th, 2008 at 1:58 pm
Every time KC posts on here it’s along the lines of how bad off we are and how the sky is falling! How about some factual foreclosure numbers before spouting off about rampant foreclosures… We’re in South Berwick, not Detroit. I don’t drive through our town and see burnt out buildings, vacant houses, dilapidated yards and overcrowded apartments. I’m not saying these things don’t exist in SB, but I am saying that I don’t think it’s as rampant a problem as you make it out to be.
I do see plenty of BMW’s, Tahoe’s, Escalades and Boats in people’s driveways along with homes filled with Big screen TV’s and lavish landscaping. The banks and mortgage lenders didn’t screw anybody; we’ve just become a society where living way above our means is normal and accepted. When times get tough people look to the government to bail them out, this is just wrong. How can we expect the town to live within their means when we as a society can’t?
Lastly, I’m disappointed that the blog has taken a dive into national politics. I knew it wouldn’t be long until someone suggested it was all George Bush’s fault…
April 18th, 2008 at 2:19 pm
bill >> we had a cash infusion this morning from Ben, and a co-ordinated central bank push on the currency. that said, again, there’s a thought that the very big players are moving en masse into multi-nationals to get out of the USD. so 2%, coupled with 3%, whatever, the point is that you are, when you factor in the currency situation, slightly less than what you paid for GE two years back, and the institutions perceive this to be a bargain.
Nick — you can’t argue with facts. Supply side has been catastrophic for the majority in this country. As far as seeing the cars you see, I would say to you that…..no one was immune to making bad, economically unwise decisions. Many got carried away. Unfortunately, getting out of a car or a house that is too big for you, is not all that easy right now. I see the same cars and I wonder how many payments are late…….
and if you look at the statistics….its one out of five now on house, 2 out of seven on cars.
So…there’s more going on behind the scenes than we see.
April 18th, 2008 at 2:33 pm
Nick-I agree with you, I don’t really like to see the blog become a discussion place for national politics either. There are about a million blogs where you can go discuss national politics, but only one that I know of where you can discuss South Berwick. Sometimes it is hard to separate local issues from state and national politics but I do want the blog to stay local as much as possible.
April 18th, 2008 at 2:40 pm
KC
I’m begining to think you are living in another universe. Glad I’m not there.
April 18th, 2008 at 2:40 pm
Molly, I would like this to stay a very, very local board. Problem is, we are impacted by outside factors. Oil closed today at 116. Now projections are that it will go to 130 before turning. That, no matter how you slice it, is going to impact the people of this town.
April 18th, 2008 at 2:55 pm
No kidding. And amonmg other things, it’s going to put pressure on Town budgets, which will need to legitimately raise taxes. You can’t scream at Town hall all the time. There are many other moons to howl at.
April 18th, 2008 at 3:00 pm
Like the School District….
April 18th, 2008 at 3:00 pm
I actually quite easy to keep it local.
Stop bringing national politics in to the discussion.
I know I have been guilty of it as well as at the state level.
I’ll make sure I keep it local from now on.
April 18th, 2008 at 3:03 pm
You guys are completely missing the point. We are entering a very very tough period economically. You can scream, you can blame, you can cry all you want. that is the bottomline. Now we do have a choice here. We can pretend this isn’t happening — the preferred way which we Americans have come to know and love — and ultimately suffer even more greatly.
Or we can confront this reality. Hunker down and protect the town. And that means cutting any and all expenses that are simply not critical. That’s it.
That simple.
April 18th, 2008 at 4:37 pm
kc- you sound like you fight for the little people in south berwick.well some of those people work for this town.
so why dont you come up with impact of the whopping 2.6% cost of living raise these employee’s will be getting? and then prove to us that those raises when eliminated will drastically cut your taxes. from your posts all i see is that you dont want town employee’s to get raises.well you know maybe their house and car payments are late.
relax on the doom and gloom,it’s not that bad.
April 18th, 2008 at 4:49 pm
Dave and KC–Obviously sometimes it’s impossible not to link things that are happening locally to state and national policies. I just don’t want the presidential elections to drown out everything else here and have the pages filled with partisan pie fights.
April 18th, 2008 at 5:00 pm
I agree Molly.
I just know I can get carried away with that sometimes, so in order to avoid it, I’ll do my best to keep it local.
April 18th, 2008 at 5:06 pm
Dave-Thanks. I know what you mean. I can throw a partisan pie with the best of them.
April 18th, 2008 at 6:28 pm
“Taxes are the the price we pay for a civilized society.”
-Oliver Wendell Holmes
April 18th, 2008 at 6:43 pm
tim, I can’t believe it: I agree with 100% of what you posted! Great!
April 18th, 2008 at 10:55 pm
Tim — Raises, upgrades to the town hall phone system, 100% medical coverage etc., are all OPTIONAL spending. They can be delayed or skipped, or as in the case of the medical, brought into line with plans that virtually everyone who doesn’t work for a municipality has. Point is, we should prioritize the critical spending, and decline all optional. Keep taxes the same and protect the tax base as much as we can over the course of the next year.
Finally, there’s one thing about these raises and how they are being defended which is truly not business-like or logical. Let’s look at the clerk’s job as an example. Its a function which getting completed is worth say 27K. Now the people doing this job maybe truly lovely and he/she may do the job quite well. But bottomline, the market worth of the job and the value of getting it done is worth somewhere around 27K. And there are plenty of people around now willing to do the job for 27K. But….we have to hand out raises.
What everyone trying to defend these raises seems to be saying is that these people doing these jobs should get more because people elsewhere doing a similar job get paid more. They think — the numbers that everyone is throwing around saying we need to be comparable to were supplied by an organization dedicated to serving the interests of municipal employees. No one, it seems, has done any independent research. Nor does anyone seem to be focusing on what it is worth to the Town to get this job done.
Whatever. All of this is like saying… milk is selling for three bucks in my town, and that’s about where it should be, at least for me… I like milk, I’m not insane about it but I like it alot…three bucks is about what its worth to me…..but, everyone is saying its five bucksin towns about fifty miles away, so i’m going to give the local store five bucks for the milk, cause they are lovely people.
This is illogical. Its also going to be something we regret deeply this time next year. As far as the “doom and gloom” goes, listen, we’ve got a media that is not going to report what’s really happening with the economy because that causes ratings to go down (no joke….CNBC lost over half its viewers in the last bear market). If you want to know what’s happening, truly, in our economy, you can go read the Brit papers online. They aren’t as concerned about sparing their readers’ feelings. In fact, they take the rather novel approach of addressing their readers as adults with reading ability above the sixth grade level, and of average intelligence.
April 19th, 2008 at 9:51 am
KC and everyone - In light of the situation we’re in, it would seem that any businesses we try to attract to town should be locally sustainable - any ideas?
April 19th, 2008 at 10:01 am
actually quite a few. we have a high school in town. we have the elementary school there too. in the mornings and afternoons, scores of parents come to drop off and pick up their children. high schoolers are a heartbeat away. And yet there is really nowhere for anyone to hang out. We got a main street with no heartbeat, no collective meeting place….
there is that property for sale across from the post office. It has parking in the back and is commercially zoned. Redo the first floor — break thru walls to create large open space. Reface the front with large glass windows. It would be a perfect coffee cafe. If I were on the town development committee, I would approach coffee cafe operators — and I don’t mean Starbucks. I mean the guys in portsmouth, ollies, and carpe diem, and there are several others of that size. We could offer tax breaks to them for the first couple of years. Possibly a grant on the renovation (that way we have some hand in the design and signage).
It would be a win, win, win. Town gets a tax revenue. Teens get jobs. Parents get a place for a nice cup of coffee in the morning or pre-afternoon pick up. the other merchants benefit from increased foot traffic. South Berwick gets a heartbeat.
April 19th, 2008 at 11:15 am
KC-I have been fantasizing about the same thing with that building. Except in my vision the little front yard is made into a courtyard so in the warm weather people can sit out at tables. Recently on a trip to a small town in Vermont I went to a coffee shop that was in a house very much like that. They had left it basically intact except for taking out some non weight bearing walls. It was great. I went on a Friday night after going out to dinner and they had a jazz band, the place was packed.
April 19th, 2008 at 11:41 am
KC, We had exactly what you describe at the corner of Paul and Main St’s. where the Yoga studio is and we also had Flynn’s News where the Chinese resturant is. There were always teens hanging around up town but when I came back from four years in the military they seemed to have disapeared and I really don’t know why.
April 19th, 2008 at 11:52 am
well, if you really wanted to give this town something, that would be it. right now its a “drop your kid, pick up your mail or chinese food/pizza, jump back in the car” drive thru town. You know, there isn’t even a place to buy a paper on main street.
April 19th, 2008 at 12:17 pm
Nature’s Way sells newspapers and SoBo at least always used to.
But I love the Me & Ollie’s-type cafe idea for across from the post office, and maybe they could sell newspapers too!
By the way, if I am thinking of the same house you all are, here is some history trivia: It seems to have been owned in the 1800s by our then-Congressman, John N. Goodwin. During the Civil War, Lincoln appointed him the first territorial governor of Arizona. His house is preserved in Prescott, AZ today, and when you walk in, he is introduced as “a native of South Berwick, Maine.” There is even a Goodwin Street. The cabin and museum are a big attraction and contribute to the vitality of downtown Prescott. Wouldn’t it be cool if a cafe in his South Berwick house contributed to revitalization here as well?
April 22nd, 2008 at 12:46 pm
“…. Council members have obliged, putting off road projects, new police and staff hires and new public works equipment. Cuts have been made virtually everywhere, except to current staff and employee salary/benefit packages.”
Unreal. Unreal. While the rest of the town tightens its belt, the staff and employees aren’t going to get hurt a bit. And in many cases, we’re not even talking belt tightening…..we’re talking one next door neighbor really hurting to provide a town employee living next door with a raise and a full package of benefits.
Unreal. People should be down demonstrating in front of town hall. You know, at some point, government and its employees should recognize that they are our employees >>> we are not theirs, nor do we have any obligation to shelter them from any and all reprecussions of a declining economy.
What is going on?