Cohen's Budget Raises Taxes, Fees

Proposing the third straight year with a budget surplus, Annapolis Mayor Josh Cohen said the city is in a “much better position” financially moving into the next fiscal year.

But it will come at a cost, with a proposed increase in property taxes, a jump in water and sewer rates and higher bus fares.

The city also would see a savings if it changes the way it collects trash, Cohen said during his State of the City address before Monday’s City Council meeting.

During the address he not only spoke about last year’s economic and financial highlights, but also mapped out his spending plan to build upon what he said was a successful year.

There is a copy of Cohen's State of the City address and fiscal 2013 budget proposal attached to this article.

The proposed general fund budget has total revenue of $100.6 million and expenditures of $95.4 million. That’s $5.16 million surplus.

“I’m able to stand before you this evening in quite a different position than I have in the past few years,” Cohen said. “We clearly have a lot of work yet to do. We are not only pointed in the right direction, we are in a much better position.”

Cohen said his proposed budget would increase the property tax rate 9.83 cents per assessed dollar value. That would bring the tax rate up to 65.83 cents, or a 4.5 percent increase.

He said 7 cents of the increase is needed to basically break even. He also said 1 percent of the increase would be dedicated to a sidewalk fund for the replacement and upkeep of sidewalks throughout the city.

Cohen’s plan also eliminates furlough days for employees and said he even has a tentative agreement for the Naval Academy to pay the same wastewater fees as everyone else—a $440,000 increase.

The proposal also includes a 2 percent increase in water and sewer bills, which would mean an increase to $224.50 from $220 for the average quarterly bill.

Another key component Cohen highlighted was a change in the city’s recycling and solid waste collection. In his address, he said he is proposing a hybrid plan that would continue to contract out recycling curbside collection and have the city continue to collect trash and yard waste.

He said with projected costs, including eliminating six positions over the next fiscal year, the city would save $2.64 million, or 28 percent.

The average annual household fee also would drop 11 percent, or $48, to $378.

Also, bus fees would jump 50 cents to $2.

Some of the spending highlights include:

• Increasing the allocation to the Annapolis Economic Development Corp. by $90,000 to $475,000.
• Increasing the allocation to Main Streets Annapolis and the Arts District by $12,500 each to $25,000.
• Creating 11 new positions, including an assistant city attorney and assistant city manager.
• Eliminating furlough days at a cost of $662,775.
• Adding $4 million from general fund to unreserved fund balance.
• Increasing the fleet replacement funding from $300,000 to $1.13 million.
• Increasing the city pension contribution to 4 percent for both the police and fire departments, a $741,000 cost.
• Setting aside $600,000 for new sidewalk fund.