Cuts coming: Board opposes bridge loan & piercing tax cap

09/03/2014 7:21 PM |
Town Board members Jim Wooten and John Dunleavy, left, and Supervisor Sean Walter at Wednesday night's Town Board meeting. (Credit: Barbaraellen Koch)

Town Board members Jim Wooten and John Dunleavy, left, and Supervisor Sean Walter at Wednesday night’s Town Board meeting. (Credit: Barbaraellen Koch)

The town won’t be taking out a $6 million line of credit to cover a $4 million structural hole in its general fund budget next year, nor will it be piercing a state-mandated tax cap to help plug the hole — meaning, cuts are on the way.

After a split Town Board tabled a measure in mid-August which would have permitted the town to borrow against future land sales at Enterprise Park at Calverton, Councilman Jim Wooten — the deciding vote on the bridge loan — said on Wednesday that the move doesn’t have his support, and voted against the measure at tonight’s meeting.

“When you’re in debt on a personal level, you don’t borrow more. You cut up your credit card,” he said in his office, before Wednesday’s much-anticipated public hearings on studies for EPCAL. “Otherwise, you’ll only end up in more debt.”

A measure to hold a public hearing on raising taxes by more than two percent also failed, leaving the deficit to be closed in ways yet to be seen. Supervisor Sean Walter, who has to present a preliminary budget before Oct. 1, opposed piercing the tax cap, along with fellow board members Jodi Giglio and George Gabrielsen.

“I’m not going to be left holding the water for the town board,” he said at the meeting. “I will deliver to you on Sept. 30 a balanced budget. And you’re not going to like what you see.”

Mr. Wooten joined Councilman John Dunleavy and Ms. Giglio as opponents of possibly borrowing next year. Mr. Walter had publicly supported the “bridge loan,” as it’s been called, more than anyone else, saying the town should be able to benefit from selling land at EPCAL before the end of next year, closing a $4 million budget gap in the town’s general fund budget.

The deficit equates to roughly a 12.5 percent tax increase for taxpayers, if no cuts were to be made next year. Though by not approving a measure to pierce the tax cap, the jobs for many town hall employees are now on the chopping block.

In August, it was estimated that covering the $4 million budget hole would equate to roughly 50 to 60 jobs, not including upcoming retirements.

Mr. Wooten, explaining his opposition to the bridge loan before Wednesday’s meeting, said he favors a combination of consolidation in town government, cuts, and tax increases, hoping to limit the damage to a 6 to 7 percent tax increase for town residents. For instance, he said, he could see the town’s sanitation department falling under the purview of the highway department, and a “pool” of account clerk typists — changing departments based on the day of the week — may be able to permit the town to maximize the town’s workforce.

“I might die by the sword, but you gotta do what you gotta do,” he said. “I think if you’re honest, and you do what you have to do, people respect that.”

The councilman was absent from the Aug. 19 meeting when the rest of the board tabled the measures, and said on Tuesday that while he hopes land will sell at EPCAL soon, and believes it will eventually under a proposed reuse plan, he doesn’t see that happening by the end of 2015.

“If we were a year down the road and had the subdivision approved, that might be one thing,” Mr. Wooten said. “But with this [bridge loan], you’re a hero or a zero. It’s not worth the risk.”

Mr. Dunleavy expressed similar sentiments in the past, telling the supervisor in early August, “I don’t think we’re going to be selling property up there as soon as you do.”

Mr. Gabrielsen expressed support for the bridge loan at the board’s Aug. 19 meeting, but said he did not favor borrowing an entire $6 million. He said on Wednesday he would expect to borrow about $1 million.

While Mr. Wooten called a bridge loan a “stupid idea,” Mr. Gabrielsen called increasing taxes over two percent “even stupider” than borrowing money next year.

When asked for comment before Wednesday meeting’s on Mr. Wooten’s position on the $6 million bridge loan, Mr. Walter declined to comment.

“We’ll see how the vote goes,” he said.

UPDATE, 10:25 p.m.: This story has been updated to reflect and include what occurred at Wednesday night’s Town Board meeting. For full coverage of the meeting, read our live blog coverage.