Mayor Laura Lewis’s (D) $101,058,360 budget proposal for 2024 featured no layoffs and full funding for all new and vacant positions requested by the city government’s departments. Lewis, however, stressed that the budget would have to be reworked should the Common Council fail to pass the memorandum of understanding between Ithaca and Cornell on Wednesday, Oct. 11, in which Cornell agreed to pay $4.08 million to the city in lieu of property taxes.
“We had to build a budget and, as has been pointed out, it is not responsible to wait until we are in the first quarter of our next budget year, January, to build the budget,” Lewis said. “We must build a 2024 budget now and I fully understand and recognize that Council will be voting on the [memorandum of understanding] next week, but it is important for Council to see the impact of that voluntary contribution.”
Property taxes will make up 43.1 percent of this revenue. The current tax rate, which sits at 11.98 percent, will not change. The tax levy will increase by five percent from 9.74 percent in 2023, while the 2024 tax cap is 2.2 percent. This means that an owner of a property at the median value in Ithaca — $302,000 — would owe $3,295 in taxes. The total revenue is projected to equal $30,690,864.
Of the property within the city, 56.94 percent — 79 percent of which Cornell owns — is tax-exempt. This is a decrease from 2023, when 57.3 percent of property in the city was tax-exempt.
The budget assumes a $4.08 million contribution from Cornell in 2024, of which $816,000 — 20 percent — will be restricted to infrastructure work determined by a joint working group, on which Cornell will not have veto power.
Lewis also said the 2024 budget will need to be reworked if the MOU is not approved.
New York State once again did not increase its contribution of slightly over $2 million to the city budget, which has remained stagnant since 2011.
“It is unfortunate that there has been a zero percent increase [in state contributions] since 2011,” Lewis said. “That’s not a typo.”
Of Ithaca’s expenses, 66.3 percent go toward salaries and benefits for city staff, according to Lewis. Retirement costs from the general fund will increase by 14.9 percent from 2023, and health insurance costs are trending at a 13 percent increase in costs, though unions cover roughly 20 percent of health insurance costs.
The city’s labor negotiations team settled all open contracts, including a longstanding negotiation with the Ithaca Police Benevolent Association, the union representing the Ithaca Police Department officers. The Common Council approved the agreement — which will run until 2026 — along with an agreement with the City Executive Association, which represents Ithaca’s municipal workers, during Wednesday’s meeting. With these agreements ratified, each of the six unions representing city employees — including both fire unions — have contracts expiring in 2024 or beyond, but all six contracts will also increase costs for the city.
Lewis attributed these cost increases to the effects of the COVID-19 pandemic, which increased inflation, made it more difficult to hire and retain employees and caused cost uncertainty with supply chain and availability issues.
The Department of Public Works will be the department with the greatest funding at over $10 million, while both IPD and the Ithaca Fire Department will each receive slightly more than $7.5 million. Lewis stated there will be no layoffs, and the city will be adding or restoring 22 positions, including a full staff for the incoming city manager position. Under Lewis’s proposal, the city will also be funding all new and vacant positions requested by all of the city’s departments.
The IFD will receive enough funding to hire three new firefighters, who will begin in their positions on Dec. 1, 2024. Human Resources will receive $25,000 in order to implement and train workers for the new commitment to equity statement, while GIAC will receive enough funding for two of its 25-hour program assistants to begin 35 hours as well as extra overtime money. IPD will add seven new police officers to start on Dec. 1, 2024 and will receive funding for a crime analyst position, $58,125 for year one of a five-year taser replacement project, $30,000 to update protective plates and $56,945 to fund a special response team.
The city will increase its contribution to TCAT by 4.4 percent from 2023.
Lewis stated her budget proposal aimed to reduce the debt load, keep taxes to a minimum, integrate the new labor contract wages and maintain fund reserves. She also said the city will evaluate infrastructure needs across Ithaca.
“Our infrastructure needs continue to be of concern and have been mentioned in the past,” Lewis said. “Deferred maintenance has meant that the millions and expenses responding to infrastructure needs continue to grow.”
Public hearings on Lewis’s proposal will occur on Oct. 11, Oct. 12, Oct. 19 and Oct. 25 at 6 p.m. at City Hall. The Common Council will vote on the proposal on Nov. 1.