October 25, 2007

Mayor Reveals 2008 City of Ithaca Budget

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Correction appended. See below.
Ithaca Mayor Carolyn Peterson expressed hope that the City’s Common Council will not seek to make too many amendments to her 2008 budget proposal before they vote on it on Nov. 7.
“It’s a pretty tight budget,” Peterson said.
The Mayor’s Recommended Budget for 2008, which is available for the public to view on the City of Ithaca’s website online, appropriates some $54 million in funding for a variety of projects and public services. This figure is slightly greater than the City’s projected revenue for next year, a difference that will be made up by a 3.75 percent increase in property taxes.
“It’s been like this for a long time. The projects we have to spend money on cost more than we have in revenue,” Peterson said.
According a recent Sun article regarding town-gown relations, 70 percent of Ithaca property is tax exempt. Cornell owns 97 percent of the total value of this property, which is $2.3 billion, according to the City’s 2007 Summary of Assessment Plan. If Cornell were to pay property taxes, as the article suggests, it would owe $30 million annually, part of which would go to the City. The increase in property taxes recommended by Peterson for 2008 does not apply to Cornell.
Peterson stated that Ithaca had been suffering economically since 1992, when state aid was eliminated, but after its reinstatement three years ago, conditions have improved.
“State aid is still only at 1991 levels, but I’m hoping the state will continue to go in the direction of understanding the plight of upstate New York cities,” said Peterson.
Peterson was not sure how Cornell’s $20 million investment in the local community over the next ten years will be spent.
“It’s so new that the process is not known at this time. One of the first steps will be for the municipalities that will be receiving University funding to sit down to discuss it with Cornell’s administration,” Peterson said.
She explained that the $20 million is in addition to an annual contribution that Cornell voluntarily makes to Ithaca according to a formal agreement with the City, and as such is entirely separate from the funds allotted in the budget.
Carolyn Ainslie, vice president for finance and budget at Cornell, stated in an e-mail that the University’s primary priorities for its contribution to the City are affordable housing and transportation management, and that specific projects will arise out of joint planning efforts between the City and University.
According to John Guten­berger, director of Cornell’s community relations department, the amount of this year’s contribution will be $1.1 million. He stated in an e-mail that 60 percent of this total is earmarked to support fire protection, and the balance goes to “other municipal services” as determined by the City.
Public safety and infrastructure are two areas that Mayor Peterson hopes to significantly increase funding for, because they have been affected by cutbacks in recent years. Her budget proposal would add two more firefighter positions and fund a maintenance crew for Ithaca’s bridges.
“The City’s Controller and I knew it’d be more difficult to formulate this year’s budget than in previous years, so we decided to issue specific guidelines to the 14 department heads,” Peterson said. The City Controller, Stephen Thayer, is Ithaca’s chief financial officer. Ithaca’s governmental department heads were asked to provide a budget proposal utilizing a 1 percent, 3 percent, or optional level increase in spending. After this funding request data is submitted to the mayor on Aug. 1, it is used as the basis for the budget recommendation that is drawn up by the mayor and presented to the Common Council on Oct. 1.
In addition, Peterson plans to appropriate $500,000 from the City’s budget balancing fund, an option that has not been enacted for the past few years. She stated that this fund’s interest had been built up from 9 to 14 percent, meeting a goal set by herself and the City’s Controller for this year.
“It gave us more cushion to appropriate funds for other projects we wanted to,” Peterson said.
The 4.6 increase in the tax levy under the Mayor’s budget proposal for next year would be the lowest implemented by the City of Ithaca in the last eight years.
However, the Common Council has the opportunity to propose changes to the budget before the final draft is put up to vote. Alderperson Gayraud Townsend (D-4th Ward) said that he believes the budget will pass without excessive revisions, but that last minute accommodations often have to be made.
“This year, the SPCA is asking for more funding. They’ve been working on credit for years but now they have a new director, and he got in the request rather late in the year,” said Townsend. “As Ithaca is one of the more transient communities in upstate New York, peo­ple and students especially won’t know what to do with their pets when they’re leaving the City, so the SPCA is really necessary,” he said.
Correction appended: “Mayor Reveals 2008 City of Ithaca Budget” incorrectly states that the total value of all Cornell-owned property in Ithaca is $2.3 billion. The total value of all Cornell-owned property in Tompkins County is 2.3 billion. The Sun regrets this error.