Monroeville passes 2021 budget without raising taxes, uses $4.2 million from savings

Monroeville Council held the line on property taxes going into 2021.

Council approved the $35.7 million budget during a special meeting Dec. 22.

When first presented to the public in October, Manager Tim Little recommended council use $5.9 million of the municipality’s fund balance to fill a gap caused by financial woes brought on by the coronavirus pandemic.

Officials were able to whittle the needed fund balance amount to $4.2 million by the time the budget was unanimously ratified.

That was done partly by correcting a $791,000 clerical error on what the municipality originally budgeted for its pension obligation and by reallocating other revenue streams as needed.

Little said the municipality is holding a $1 million transfer from its Other Postemployment Benefits trust fund and savings from restructuring a 2015 bond which is expected to free up $1.6 million in 2021.

He said that money has not officially been transferred into the fund balance because he and council are waiting to see how impactful the tax revenue losses are this year. Little said April 15, when 2020 tax filings are due, will be a “day of reckoning.”

Little said that although the municipality will not know how much of an impact the ongoing pandemic might have on tax revenue, his projections show a combined loss of $3.1 million in earned income, business, mercantile and delinquent taxes.

Councilman Ron Harvey said the $1 million from the sale of the municipality’s pool in October 2019 is another potential source of income that could help offset tax revenue losses. Shortly after the sale, council decided to save the money for future Parks and Recreation projects.

“I would encourage council to leave (money) in the Parks and Recreation fund,” Mayor Nick Gresock said.

Harvey countered that the money was set aside before a pandemic hit.

“Though I agree with you, it’s still liquid,” Harvey said.

The money, council eventually agreed, could be used to offset losses in 2021.

Another method council discussed to free up funds is the restructuring of a 2015 bond, which has not officially happened. Council still needs to vote on an ordinance that would allow the move.

If approved, it would mean Monroeville would pay off the remaining debt over a longer period of time in smaller increments. Under a plan drawn up by Public Financial Management, a Philadelphia-based public financial advisory firm, the debt wouldn’t be paid off until 2026, instead of the expected date of 2023.

Though the bond restructuring frees up $1.6 million in 2021, the municipality would pay around $85,000 more by the time the debt is paid in full, Little said. Little expects an ordinance to be voted on in February or March.

Other significant expenses include $100,000 for two new police cruisers, $663,000 for police body and dash cameras and computers to support them, $1 million for the 2021 road resurfacing program, another $1 million to fix a retaining wall on Old Ramsey Road and $185,000 for equipment for the municipality’s Emergency Management Service.

The money for the Old Ramsey Road project will come from Monroeville’s Pollution Control and Flood Reduction program, which was established in 2018 to pay for projects related to stormwater infrastructure.

Gresock commended administration for coming up with a spending plan that did not raise property taxes and maintained municipal services.

“Council did have to spend some of our fund balance, but that’s what a savings account is for,” Gresock said.