Lower Merion Township, PA
Home MenuCitizens' Summary - 2016 Proposed Budget
Township of Lower Merion
Montgomery County, Pennsylvania
2016 Proposed Budget
Citizens’ Summary
November 6, 2015
Elizabeth S. Rogan
President, Board of Commissioners
Commissioner C. Brian McGuire
Chair, Finance Committee
Ernie B. McNeely
Township Manager
Eric M. Traub
Chief Financial Officer
2016 PROPOSED BUDGET HIGHLIGHTS
Key Dates
Distribution of Budget to the Board, Libraries, Staff and the Media:
- November 6, 2015
Public Hearings:
- November 18
December 2
Budget Adoption:
- December 16
Personnel
Net Full-Time Equivalent (FTE) Positions will decrease 1.8 FTE's from the 2015 Budget level of 476.5 to 474.8 in 2016. Refer to the Personnel Section of Budget Message for more details.
Taxes and Fees
-
The Real Estate Tax millage rate will remain unchanged for 2016 (fifth consecutive year).
-
The adopted 2015 Solid Waste Fees will remain unchanged in 2016 as follows: one mini can ($205), one container per week subscription ($292), plus $58 for each additional can and the Rear Yard Collection Fee for refuse and recycling placed more than 5 feet from the curb line ($210).
- The 2016 Budget indicates the possibility of a rate increase to the Sanitary Sewer Rental Fee and drawdown of fund balance may be needed to balance the budget and maintain a 10% fund balance reserve. The Sanitary Sewer rental rate will be further reviewed before the official 2016 Sanitary Sewer rental rate is adopted by ordinance and billed in May 2016.
General Fund Budget Summary
2015 Estimated Actual:
-
The 2015 Revenue is estimated at $59,900,030, an increase of $1,666,430 or 2.9% compared to the 2015 Budget.
-
The 2015 Expenditures are estimated at $60,993,787, an increase of $572,858 or 0.9% compared to the 2015 Budget.
-
The 2015 Estimated Actual expenditures exceed revenues (deficit) by $1,093,757.
2016 Proposed Budget:
-
The 2015 ending fund balance (undesignated) is estimated at $18,536,141 or 30.4% of the 2015 Estimated Actual Expenditures.
-
The 2016 Revenue is budgeted at $59,071,644 an increase of $838,044 or 1.4% compared to the 2015 Budget.
-
The 2016 Expenditures are budgeted at $61,821,504, an increase of $1,400,572 or 2.3% compared to the 2015 Budget.
-
The 2016 Budget expenditures exceed revenue by $2,749,860 requiring a planned budgeted drawdown of fund balance to balance operating revenue with expenditures.
-
The 2016 Budget includes $1,200,000 of estimated negative appropriations (budgetary savings) in Non-Departmental (Department 70).
-
The 2016 Budget ending fund balance (undesignated) is estimated at $15,786,281 or 25.5% of the 2016 Budget Expenditures.
| 2016 PROPOSED BUDGET ALL FUNDS SUMMARY |
|||||||
|---|---|---|---|---|---|---|---|
| FUND |
BEGINNING
FUND BALANCE |
+ |
REVENUE
|
- |
EXPENDITURES
|
= |
ENDING
FUND BALANCE |
| GENERAL |
$18,736,141
|
$59,071,644
|
$61,821,504
|
$15,986,281
|
|||
| EQUIPMENT |
13,465,648
|
3,532,344
|
4,314,977
|
12,683,015
|
|||
| SANITARY SEWER |
14,536,942
|
7,832,000
|
8,387,102
|
13,981,840
|
|||
| SINKING |
-
|
11,958,582
|
11,958,582
|
-
|
|||
| CAPITAL PROJECTS |
5,959,235
|
33,852,765
|
39,812,000
|
-
|
|||
| HIGHWAY AID |
-
|
1,514,160
|
1,514,160
|
-
|
|||
| SPECIAL REVENUE |
-
|
4,090,243
|
4,090,243
|
-
|
|||
| SOLID WASTE |
960,524
|
7,153,284
|
7,267,952
|
845,856
|
|||
| APPLEFORD |
101,000
|
-
|
-
|
101,000
|
|||
| SUBTOTAL |
$53,759,490
|
129,005,022
|
$139,166,520
|
$43,597,992
|
|||
| TRANSFER BETWEEN FUNDS |
-
|
(17,621,768)
|
(17,621,768)
|
-
|
|||
| TOTAL |
$53,759,490
|
$111,383,254
|
$121,544,752
|
$43,597,992
|
|||
| REVENUE SUMMARY BY MAJOR CATEGORY | |||
|---|---|---|---|
|
Revenues
|
2014 Actual
|
2015
Estimated Actual |
2016 Budget
|
| Program Revenues: | |||
| Charges for Services |
$17,945,366
|
$18,063,023
|
$18,006,328
|
| Grants |
5,917,389
|
6,796,965
|
30,741,218
|
| Departmental Earnings |
2,519,199
|
2,520,000
|
2,565,000
|
| Licenses and Permits |
5,513,292
|
5,454,000
|
5,609,370
|
| Fines and Forfeits |
1,025,967
|
1,070,000
|
1,088,500
|
| General Revenues: | |||
| Real Estate Taxes |
$31,049,248
|
$31,041,907
|
$31,224,008
|
| Business Taxes |
10,875,458
|
12,800,000
|
11,176,000
|
| Real Estate Transfer Tax |
3,341,636
|
3,428,280
|
3,565,411
|
| Investment Income |
87,187
|
92,760
|
85,165
|
| Other: | |||
| Proceeds from the Sale of Bonds |
$17,226,873
|
$12,532,123
|
$9,000,000
|
| Transfers In |
13,955,207
|
14,224,990
|
15,170,142
|
| Other Revenue |
2,031,305
|
734,660
|
773,880
|
| Transfers Between Funds |
(16,099,140)
|
(16,562,832)
|
(17,621,768)
|
| Total Net Revenues |
$95,388,987
|
$92,195,876
|
$111,383,254
|
| EXPENDITURE SUMMARY BY FUNCTION | |||
|---|---|---|---|
|
Function
|
2014 Actual
|
2015
Estimated Actual |
2016 Budget
|
| General Government |
$9,411,586
|
$10,167,288
|
$10,121,120
|
| Public Safety |
23,234,139
|
24,146,159
|
24,787,682
|
| Building and Planning |
3,422,778
|
3,477,946
|
3,810,972
|
| Community Development |
1,107,517
|
1,376,197
|
1,271,987
|
| Public Works |
13,827,644
|
14,549,015
|
14,093,633
|
| Libraries and Recreation |
7,413,143
|
7,514,683
|
7,447,758
|
| Debt Service |
20,673,614
|
20,755,115
|
22,166,314
|
| Capital Outlays |
15,706,083
|
14,192,000
|
39,812,000
|
| Sanitary Sewer |
7,748,844
|
8,113,239
|
8,387,102
|
| Solid Waste |
6,809,866
|
7,215,747
|
7,267,952
|
| Transfers Between Funds |
(16,099,140)
|
(16,562,832)
|
(17,621,768)
|
| Total Net Expenditures |
$93,256,074
|
$94,944,557
|
$121,544,752
|
Function and Description: The General Fund accounts for the financial resources of the Township which are not included in any other Fund. Principal sources of revenue are taxes, licenses and permits, and departmental earnings.
| GENERAL FUND | ||||
|---|---|---|---|---|
|
2014 ACTUAL
|
2015 BUDGET
|
2015
ESTIMATED ACTUAL |
2016
BUDGET |
|
| FUND BALANCE - JANUARY 1 |
$20,172,706
|
$16,270,429
|
$19,829,898
|
$15,986,281
|
| DESIGNATED TO BALANCE BUDGET * |
-
|
2,187,329
|
-
|
2,749,860
|
| REVENUE |
57,835,463
|
58,233,600
|
59,900,030
|
59,071,644
|
| TOTAL RESOURCES AVAILABLE |
78,008,169
|
76,691,358
|
79,729,928
|
77,807,785
|
| EXPENDITURES |
58,178,271
|
60,420,929
|
60,993,787
|
61,821,504
|
| TOTAL RESOURCES REQUIRED |
58,178,271
|
60,420,929
|
60,993,787
|
61,821,504
|
| FUND BALANCE - DECEMBER 31 |
$19,829,898
|
$16,270,429
|
$18,736,141
|
$15,986,281
|
| Sources of Revenue: Real Estate Taxes (52.8%), Other Taxes (25%), Licenses and Permits (9.5%), Departmental Earnings (4.3%), Fines and Forfeits (1.8%) and Other Revenue (6.6%). | ||||
| Sources of Expenditures: General Government (11.6%), Public Safety (40%), Building and Planning (6.2%), Public Works (13.6%), Libraries and Recreation (12.1%) and Debt Service (16.5%). | ||||
| Budget Changes: The Proposed 2016 Revenue Budget increased $838,044 (+1.4% ) in comparison with the 2015 Budget. This is primarily attributed to better business and mercantile tax, real estate transfer tax, highway aid and building and electrical permit fees performance projected in 2016. The 2016 Real Estate Tax (RET) millage rate remains unchanged and is proposed at 4.19 mills. This is the fifth consecutive year of no RET millage rate increase. Proposed 2016 revenues are projected to increase in real estate transfer tax (+6.1%), building and electrical permits (+8.6%), highway aid (+11.3%), business and mercantile tax (+1.6%) and cable television franchise fees (+6.4%) versus the 2015 Budget. For more detail, see the General Fund revenue categories and discussion of significant trends and assumptions. The Proposed 2016 Expenditure Budget increased approximately $1.4 million (+2.3%) in comparison with the 2015 Budget. This is primarily attributed to salary and wages (+1.6%), debt service (+6.7%) and professional services (+15.6%). The 2016 Expenditure Budget increased $827,717 (+1.4%) in comparison with the 2015 estimate. The Proposed 2016 Expenditure Budget includes $1.2 million of projected expenditure savings throughout the budget, which is expected to occur through ongoing cost containment and budgetary savings practices. Such savings would result in the General Fund ending 2016 with an actual operating deficit of approximately $2.7 million, thus reducing GF undesignated fund balance to approximately $15.8 million or 25.5% of the GF 2016 forecasted expenditures, and above the Township's fund balance policy goal range of 15% to 18%. The 2015 Estimated Actual ending GF undesignated fund balance is projected at approximately $18.5 million or 30.4% of the 2015 GF estimated actual expenditures. |
||||
| * A portion of the December 31 fund balance is appropriated to balance the following year's operating budget. The 2015 Estimated Actual projects a deficit of $1.1 million. In the Proposed 2016 Budget, approximately $2.7 million is being designated from the estimated actual 2015 ending fund balance to create a balanced 2016 Budget. **It should be noted that approximately $0.2 million of the fund balance is designated for open encumbrances and not included in the Township's undesignated General Fund fund balance policy calculation. | ||||
| GENERAL FUND - REVENUE SUMMARY | ||||
|---|---|---|---|---|
|
2014
ACTUAL |
2015
BUDGET |
2015
ESTIMATED ACTUAL |
2016
BUDGET |
|
| TAXES: | ||||
| REAL ESTATE - CURRENT YEAR |
$30,366,570
|
$30,547,000
|
$30,384,304
|
$30,441,405
|
| - PRIOR YEAR |
567,328
|
720,000
|
500,000
|
625,000
|
| - INTERIM |
56,333
|
75,000
|
105,000
|
105,000
|
| ACT 511 - REAL ESTATE TRANSFER |
3,341,636
|
3,360,000
|
3,428,280
|
3,565,411
|
| - EMST/LOCAL SERVICES TAX |
1,881,538
|
1,825,000
|
1,850,000
|
1,868,500
|
| - BUSINESS & MERCANTILE |
8,993,921
|
9,162,000
|
10,950,000
|
9,307,500
|
|
TOTAL TAXES
|
45,207,326
|
45,689,000
|
47,217,584
|
45,912,816
|
| LICENSES & PERMITS: | ||||
| BEVERAGE |
19,550
|
21,000
|
20,000
|
20,000
|
| BUILDING & ELECTRICAL |
2,301,966
|
2,000,000
|
2,075,000
|
2,172,438
|
| BUSINESS PRIVILEGE & MERCANTILE |
148,933
|
140,000
|
142,000
|
143,420
|
| ALARM REGISTRATION FEES |
489,251
|
500,000
|
530,000
|
543,250
|
| PLUMBING |
368,958
|
315,000
|
285,000
|
294,263
|
| STREETS |
160,178
|
200,000
|
300,000
|
275,000
|
| HEALTH |
65,573
|
69,000
|
67,000
|
67,000
|
| RECREATION |
489,251
|
500,000
|
530,000
|
543,250
|
| FRANCHISE FEES |
1,430,333
|
1,442,000
|
1,475,000
|
1,534,000
|
| OTHER LICENSES & PERMITS |
29,985
|
30,000
|
30,000
|
30,000
|
|
TOTAL LICENSES & PERMITS
|
5,513,292
|
5,250,000
|
5,454,000
|
5,609,370
|
| FINES & FORFEITS: | ||||
| ORDINANCE VIOLATIONS |
641,592
|
700,000
|
700,000
|
700,000
|
| DISTRICT JUSTICE |
384,375
|
410,000
|
370,000
|
388,500
|
|
TOTAL FINES & FORFEITS
|
1,025,967
|
1,110,000
|
1,070,000
|
1,088,500
|
| DEPARTMENTAL EARNINGS: | ||||
| PARKING |
1,251,882
|
1,296,000
|
1,250,000
|
1,250,000
|
| POLICE SERVICES |
401,646
|
357,000
|
360,000
|
378,000
|
| RECREATION |
287,309
|
285,000
|
345,000
|
357,450
|
| ZONING & SUBDIVISION |
439,811
|
449,000
|
460,000
|
479,600
|
| HIGHWAY SERVICES |
87,569
|
61,000
|
101,000
|
95,950
|
| FIRE SERVICES |
5,250
|
4,000
|
4,000
|
4,000
|
|
TOTAL DEPARTMENTAL EARNINGS
|
2,473,467
|
2,452,000
|
2,520,000
|
2,565,000
|
| OTHER REVENUE: | ||||
| PAYMENT IN LIEU OF TAXES |
59,016
|
60,000
|
52,603
|
52,603
|
| INVESTMENT INCOME |
62,636
|
56,000
|
61,000
|
61,915
|
| INDIRECT COSTS - SOLID WASTE |
846,000
|
880,000
|
880,000
|
915,200
|
| INDIRECT COSTS - SANITARY SEWER |
630,000
|
655,000
|
655,000
|
681,200
|
| REIMBURSED EXPENSES |
188,896
|
155,000
|
100,000
|
155,000
|
| FEDERAL BAB'S SUBSIDY |
183,194
|
196,000
|
187,843
|
203,380
|
| HIGHWAY AID |
1,269,972
|
1,360,600
|
1,402,000
|
1,514,160
|
| GRANTS AND GIFTS - POLICE |
68,045
|
50,000
|
50,000
|
50,000
|
| OTHER |
307,652
|
320,000
|
250,000
|
262,500
|
|
TOTAL OTHER REVENUE
|
3,615,411
|
3,732,600
|
3,638,446
|
3,895,958
|
| TOTAL REVENUE |
$57,835,463
|
$58,233,600
|
$59,900,030
|
$59,071,644
|
| GENERAL FUND - SOURCES OF REVENUE | ||||
|---|---|---|---|---|
|
2014
ACTUAL |
2015
BUDGET |
2015
ESTIMATED ACTUAL |
2016
BUDGET |
|
| REAL ESTATE TAXES |
$30,990,231
|
$31,342,000
|
$30,989,304
|
$31,171,405
|
| OTHER TAXES |
14,217,095
|
14,347,000
|
16,228,280
|
14,741,411
|
| LICENSES & PERMITS |
5,513,292
|
5,250,000
|
5,454,000
|
5,609,370
|
| FINES & FORFEITS |
1,025,967
|
1,110,000
|
1,070,000
|
1,088,500
|
| DEPARTMENTAL EARNINGS |
2,473,467
|
2,452,000
|
2,520,000
|
2,565,000
|
| OTHER REVENUE |
3,615,411
|
3,732,600
|
3,638,446
|
3,895,958
|
| TOTAL: |
$57,835,463
|
$58,223,600
|
$59,900,030
|
$59,071,644
|
| GENERAL FUND - USE OF FUNDS | ||||
|---|---|---|---|---|
|
2014
ACTUAL |
2015
BUDGET |
2015
ESTIMATED ACTUAL |
2016
BUDGET |
|
| GENERAL GOVERNMENT |
$6,539,981
|
$7,068,851
|
$7,230,473
|
$7,167,416
|
| PUBLIC SAFETY |
23,225,801
|
24,627,686
|
24,121,160
|
24,762,682
|
| BUILDING & PLANNING |
3,422,778
|
3,720,486
|
3,477,946
|
3,810,972
|
| PUBLIC WORKS |
8,315,047
|
7,841,539
|
9,090,200
|
8,424,944
|
| LIBRARIES |
4,143,983
|
4,269,071
|
4,228,048
|
4,126,328
|
| RECREATION |
3,269,160
|
3,325,876
|
3,286,635
|
3,321,430
|
| DEBT SERVICE |
9,261,521
|
9,567,420
|
9,559,325
|
10,207,732
|
| TOTAL: |
$58,178,271
|
$60,420,929
|
$60,993,787
|
$61,821,504
|