Mayor Purzycki’s Wilmington Revised Fiscal Year 2021 Budget Is Approved

From the City of Wilmington:

May 28, 2020

COVID-related $13.6 million revenue loss is projected; budget is reduced by $3.9 million over current budget and requires no property tax or water rate increase; City workforce as well current programs and services are preserved

Wilmington Mayor Mike Purzycki tonight thanked City Council for approving a revised operating budget for Fiscal Year 2021 that begins July 1. The new, reduced budget reflects the first wave of COVID-19 consequences for the local government and economy. The Mayor said his Administration is determined to see that Wilmington emerges from the COVID-19 crisis in a better position than when the pandemic began.

The revised $163.5 million budget is $5.7 million smaller than the budget Mayor Purzycki proposed to Council in March and is $3.9 million less than the current City budget. The new budget reflects additional spending cuts made by City departments in recent weeks to match reduced City revenue. The Mayor said the new budget does not require a property tax or water rate hike, and it preserves the current City workforce and the current level of City services. He cautioned, however, that the full scope of COVID-19 on the local economy, and therefore on the City’s finances, is not fully known at this time. The Mayor said the approved budget may have to be revised again in a few months after the next quarterly revenue totals are known.

The amended operating budget reflects a projected revenue loss of at least $13.6 million for the next fiscal year beginning July 1. And that is on top of the projected $9 million revenue loss the City is dealing with in this current fiscal year, which ends June 30. Even with additional budget cuts, Mayor Purzycki said the City needed $5.4 million from the Tax Stabilization Fund to balance the FY 2021 budget. This is the first time in eight years that the City has had to tap surplus funds to balance the budget. The $5.6 million in additional reductions made to the FY 2021 budget include $2.1 million in health care cost savings and $3.5 million in other reductions as reflected in the summary at the end of this news release. Download the FY 2021 Budget Summary here.

“The revised budget represents the most accurate look at this time as to how devastating COVID-19 has been and will be for the local economy,” said Mayor Purzycki. “We are meeting many of the initial challenges brought on by this virus, but we have many more to go. There are a lot people hurting right now. That means our government must stay strong and efficient to provide quality City services for residents and businesses and to help our most vulnerable residents receive information about COVID-19 testing and protective materials such as masks to keep them and others healthy.”

“When it is safe to do so,” the Mayor continued, “we will re-start our economy and get people back to work and our children back into a classroom. Our goals also include making sure our business community has an opportunity to thrive again, and that our restaurants and arts and entertainment venues re-open as strongly as possible and provide us needed relief from this isolation that we are not accustomed to. The future will be different. Until there is a vaccine, we must adjust to a new way of life. And that’s why it’s important we continue social distancing, washing our hands, wearing a mask, and doing anything else we can to help others in our neighborhoods and throughout our City.”

The Mayor said COVID-19 is not stopping the City from moving forward on some game-changing projects that will be part of future City celebrations once the virus crisis has subsided. These include a refurbished Rodney Square; a new music, TV, and entertainment sound stage on the 7th Street Peninsula; the South Wilmington Wetlands Park; new apartment living on the Brandywine River, along Pennsylvania Avenue, and along lower Market Street (LOMA), as well as homeownership opportunities on Bennett Street on the Eastside; the Wilmington Transit Center; new additions to the already beautiful Flats housing complex between Union Street and Bancroft Parkway; and the conversion of Baynard Stadium into a new state-of-the-art sports complex by Salesianum School anchored by the new Abessinio Stadium. Mayor Purzycki said Wilmington will keep moving forward and will deal with new challenges—COVID-related or not—head-on.

Here is the departmental summary of the additional budget reductions made to the approved FY 2021 City operating budget:

POLICE
Total Reduction: $1,328,831 Dept. Reduction: $472,125 Healthcare Savings: $856,706

• $345,000 reduction for elimination of 10 of the 20 proposed new neighborhood cameras and associated contractual monitoring personnel
• $67,795 reduction for elimination of vacant Communication & Data Specialist position
• $70,280 General Fund reduction for elimination of two new School Resource Officers requested in the original Proposed Budget

FIRE
Total Reduction: $596,103 Dept. Reduction: $178,146 Healthcare Savings: $417,957

• $150,500 reduction for recruit fees, uniforms, and equipment
• $22,000 increase for contractual Station 5 condo agreement

PARKS
Total Reduction: $633,411 Dept. Reduction: $541,804 Healthcare Savings: $91,607

• $226,530 reduction for temporary salaries, including Hicks summer camp and rec specialists, Recreation scorekeepers and seasonal programs, and various Youth and Families programs
• $56,000 reduction in Consultants funding
• $50,000 reduction for Hicks building maintenance services
• $50,000 reduction for Maintenance Division temporary agencies
• $30,000 reduction for Arts in the Park and Delaware Nature Society
• $12,800 reduction for Camp Barnes
• $116,474 in various MS&E reductions, including noncapitalized equipment, advertising, and maintenance

MAYOR’S OFFICE
Total Reduction: $424,216 Dept. Reduction: $360,463 Healthcare Savings: $63,753

• $124,863 reduction to Personal Services, which reflects the removal of funding for the Deputy Director of Economic Development position
• $103,000 reduction to Grants to Agencies, which reflects a reduction in grant funding for community events and organizations
• $65,000 total reduction to Consultants spread across the Mayor’s Office, the Office of Management & Budget, and the Office of Cultural Affairs

CITY COUNCIL GENERAL FUND
Total Reduction: $470,653 Dept. Reduction: $437,107 Healthcare Savings: $33,546

• $132,981 reduction to Personal Services, which reflects the elimination of a new Legislative Council position requested in the original Proposed Budget
• $108,000 reduction to Miscellaneous Projects
• $92,000 reduction to Consultants

CITY COUNCIL CATV FUND
Total Reduction: $44,000 Dept. Reduction: $44,000 Healthcare Savings: N/A

• $40,000 reduction to Consultants (WITN public relations services contract)
• $2,000 reduction to Travel
• $2,000 reduction to Registrations

PLANNING & DEVELOPMENT
Total Reduction: $21,021 Dept. Reduction: $4,393 Healthcare Savings: $16,628

• $2,893 total reduction to Travel & Subsistence and Registrations, reflecting the low likelihood of travel to conferences and other professional development opportunities in the coming year

DEPARTMENT OF INFORMATION TECHNOLOGIES
Total Reduction: $420,853 Dept. Reduction: $372,796 Healthcare Savings: $48,057

• $299,000 reduction to Computer Software Licenses, reflecting the removal of funds budgeted for upgrading the City’s accounting software to the Cloud
• $67,796 reduction to Personal Services, which reflects the elimination of a vacant Document Management Technician position

PUBLIC WORKS GENERAL FUND
Total Reduction: $674,680 Dept. Reduction: $397,087 Healthcare Savings: $277,593

• $260,000 reduction for landfill fees, temporary agencies and roads and repairs
• $136,087 reduction for consultants, contracted maintenance services, engineering, overtime and holiday pay

PUBLIC WORKS WATER/SEWER FUND
Total Reduction: $834,022 Dept. Reduction: $610,075 Healthcare Savings: $223,947

• $505,550 reduction for computer software non-capital, consultants, and repairs to building structures
• $104,525 reduction for laboratory fees, engineering, and noncapitalized equipment

FINANCE GENERAL FUND
Total Reduction: $417,815 Dept. Reduction: $285,000 Healthcare Savings: $132,815

• $170,000 reduction for collection expense
• $115,000 reduction for temporary agencies and training

FINANCE WATER/SEWER FUND
Total Reduction: $265,692 Dept. Reduction: $212,500 Healthcare Savings: $53,192

• $200,000 reduction for collection expense legal and sheriff sale
• $12,500 reduction for furniture and fixtures

LAW
Total Reduction: $262,301 Dept. Reduction: $223,033 Healthcare Savings: $39,268

• Reduce Court Costs & Notary Fees by $60,000 due to the pause in sheriff sales
• Eliminate Operation Heat, saving $83,033
• Reduce Legal $80,000 by eliminating consultants used in labor negotiation

AUDIT GENERAL FUND
Total Reduction: $24,952 Dept. Reduction: $10,000 Healthcare Savings: $14,952

• Eliminate Travel & Subsistence, saving $10,000

LICENSES & INSPECTIONS
Total Reduction: $189,796 Dept. Reduction: $95,555 Healthcare Savings: $94,241

• Delete the vacant plans examiner position, saving $95,555

TREASURER’S OFFICE GENERAL FUND
Total Reduction: $5,118 Dept. Reduction: $0 Healthcare Savings: $5,118
REAL ESTATE & HOUSING GENERAL FUND
Total Reduction: $3,689 Dept. Reduction: $0 Healthcare Savings: $3,689
HUMAN RESOURCES GENERAL FUND
Total Reduction: $181,797 Dept. Reduction: $144,000 Healthcare Savings: $37,797

• Eliminate Consultants in the Employment Services Division, saving $50,000. These funds were to be used for City University
• Eliminate Consultants in the Classification & Compensation Division, saving $50,000. These funds were to be used for the study of the implementation of a new classification & compensation system
• Reduce Miscellaneous Charges- NOC in the Compliance Division by $21,000 to a new budgeted total of $41,400

HUMAN RESOURCES SELF–INSURANCE FUNDS

(Risk Management Fund - Workers’ Compensation Fund - Health and Welfare Fund)
Total Reduction: $2,465,195 Dept. Reduction: $2,465,195 Healthcare Savings: N/A

• Reduce Medical Costs in the Health & Welfare Fund by $1,044,197 based on up-to-date data provided by USI, the City’s insurance broker
• Reduce Prescription Costs in the Health & Welfare Fund by $1,244,070 after considering projected rebates and discounts
• Reduce Dental Costs in the Health & Welfare Fund by $177,108 due to the City moving to a self-insured plan
• Reduce Medical Stop Loss Insurance in the Health & Welfare Fund by $55,933 due to a decrease in overall claims, as well as a reduction in large claimants

This press release was produced by the City of Wilmington. The views expressed here are the author’s own.