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You are Viewing an Archived IssuePosted: 05/09/12
DDA mulls over 2012-13
budget's reduced revenue
by CHRIS GRAYThe Romeo Downtown Development Authority (DDA) must contend with declining revenues and increased expenses for 2012-13.
Observer Staff Writer
During its May 3 meeting, the DDA discussed its budget for the coming year with the knowledge that its Tax Increment Financing (TIF) will be reduced by 23 percent, while expenses like payroll will increase.
A proposed 2012-13 budget will be presented at a special meeting held May 16, with the goal of having a budget ready for the Village Council by June.
DDA Treasurer Carol Humphreys said if the DDA can create a budget in the $100,000 range it should be fine for the next fiscal year.
To keep operations running at status quo if no cuts were made, she said the board would need to use $20,000 of its $64,000 savings to cover its expenses.
"That leaves just $44,000 to roll over into the next year, which we know again is going to be short," she said.
Hindering the budget is the fact that TIF payments from Washington and Bruce townships will be reduced in the coming year.
Washington Township's contribution is 13 percent less for a total payment of $27,000, while Bruce Township's payment is 10 percent less for an estimated $17,000.
In addition to this, the consent judgment that resulted from the DDA's lawsuit against the village calls for Romeo's TIF payment to be returned to village coffers. The payment is estimated to be $65,000 for 2012-13.
Humphreys said the DDA has $135,000 that will be available for spending, but she wanted to put away $10,000 to ensure the DDA could pay its bills in July and August since TIF funds typically arrive in October.
"It would leave us money at the end of the year because we know we don't get our funding right away, so we can never deplete our pot," she said.
The largest portion of the DDA's funding is devoted to sprucing up downtown with Christmas decorations and flowers. These cost the DDA $36,000 of its budget.
Vice-chairperson Randy Seidel said reducing spending on these items has been discussed, and the board should consider any reductions early so they know what to bid on when the time comes.
"We really all agreed (the flowers are) an eye-catcher, it's important, and to cut it in half, why bother," he said. "Maybe in 2013 we do re-visit and go to two-thirds of it."
DDA members considered having businesses sponsor the large planters on Main Street, but business owners atending the meeting reacted negatively to the notion.
The next highest expense will be payroll at $22,000, an increase from last year now that the DDA has hired a part-time director.
Conversely, the DDA spent about $15,000 in legal fees this past year due to the lawsuit, so Humphreys expect next year's legal fees to be closer to $2,000.
She anticipates the DDA to spend $153,000 by the end of this fiscal year, which includes $69,000 it gave back to the village.
Aside from TIF funds, the DDA will receive an estimated $16,000 from its millage in 2012-13. It also receives $11,500 a year for 10 years from the village due to the consent judgment.