The Fortnight Flip-flop
JIPSD Commission passes 2013-14 budget amended for tax hike
By Charlie Morrison | Community Editor
Oh, what a difference a couple of weeks makes … even when it comes to long-term municipal budgeting, a task typically measured in months, not weeks. On Monday, April 22, the James Island Public Service District (JIPSD) Commission proved as much, when the seven-member body voted by a 4-3 margin to reverse course on their initial proposal to fund the coming year’s activities.
A key ingredient to the plan, which was rubber-stamped by the PSD and should soon be on its way to North Charleston for Charleston Council’s review, is a small increase to the millage rate the utility charges its more than 25,000 residents. The one mil rate increase should not greatly impact James Island homeowners in the coming year, however it’s not the rate hike itself that has many in the community miffed with the utility, but rather the way the impending tax hike was presented (or wasn’t) to the community.
The organization has seen revenues level off over the past few years, is operating at a loss and is predicting ever-rising expenditures on the horizon.
At the April 8 Commission meeting the initial, tax-flat budget proposal was given first reading, and after a healthy debate, passed. The crux of the debate was the Commission’s choice to pay for increases to expenditures through gradually drawing down the organization’s nearly $3.4 million fund balance (savings account), or to increase revenues by raising taxes through the millage rate.
At that time, and by a tight 4-3 margin, the group voted to keep the tax rate flat for the coming fiscal year. Just two weeks later, at last Monday’s Commission meeting, the group reversed course, opting to raise the millage rate a single point as part of a plan outlined by Commissioner Rod Welch. And while Welch’s plan is well reasoned, the other Commissioners first saw the new alternative budget only days prior, on the Friday before the meeting.
The following Monday, Welch introduced his alternative, a plan that maintained a large fund balance in case of emergency while slowly raising the millage rate for the 25,000 or so residents living within the district to meet projected expenditures.
As an amendment to the working budget that had already received first reading, Welch’s budget plan displaced the previous plan as the favored alternative, with fellow commissioners Eugene Platt and Donald Hollingsworth joining Commission Chair David Engelman in voting for the amended budget and concurrent tax hike.
The budget amendment proposed the JIPSD’s more than 125 employees be given a flat, across the board, three percent cost of living increase to their base salary. The amended budget would strike the usage of merit based pay, and mandate the organization raise the millage rate by a point. That was reasonable, according to Engelman.
“I think we are one of the most fiscally responsible governments in the region,” said Engelman. “All our budget revenue is through taxes, but a mil increase for us is a lot different than a mil increase for say the Charleston County District, which (generates) over a million dollars … I think we’re very responsible.”
For Welch, the JIPSD needs to be creative when generating revenues, as the utility is literally hemmed in by other municipalities with a customer base that’s not likely to expand with the times.
“We were able to raise taxes a very small amount because we do have the fund balance. It’s there in case something happens down the road, yes, but it’s also there to help keep the millage increases necessary down,” said Welch about his amended budget. “And to have no increase to the millage … it was like almost a formula for getting the PSD in a hole in a hurry.”
As to whether the inclusion of a tax increase merited the budget being vetted publically all over again, Welsh was less strident in his take. “This was actually a question I asked myself, because I knew I wanted to amend the budget or at least make a motion that we amend the budget,” he said. “I asked if, given we’de made a change at the second reading, if it would be necessary to hold a second budget hearing, and the answer that I got was no.”
Still others on the Commission weren’t satisfied with the JIPSD’s efforts at informing the public of the impending vote on the tax hike that has now come and gone.
“If you don’t put it on the website, if you don’t put it in the paper, you’re not doing all you can do to announce this to the public,” says PSD commissioner Carter McMillan. “We owe them (residents) more than that.”
The next meeting of the JIPSD Commission will be Monday, May 13. JIPSD Commission quarters are located at 1739 Signal Point Rd. and begin promptly at 7 p.m.
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