For 2009, village trims projects but says finances are healthy

12/17/2008

Fewer road and capital improvement projects are slated in Ottawa Hills for 2009, as the village pares back spending in the face of a national recession.

Officials say the village s financial picture remains strong. However, the village is moving forward cautiously for the coming year; revenues are predicted to decline 12 percent from 2008 levels.

Overall revenues are expected to dip from $6.4 million projected for this year to $5.6 million next year, largely due to a decline in inheritance tax.

The village will draw $972,520 from its reserves of about $10 million to offset the decline, Finance Director Karen Urbanik said.

Village council unanimously approved an appropriations package last week, totalling $95,865 less than in 2008. Total spending was trimmed from about $6.71 million to $6.62 million.

Village administrator Marc Thompson said the decline is no cause for concern. So far, the village has suffered little from the economic downturn.

Income tax revenues through this November are slightly ahead of 2007 levels from the same time period. Real estate taxes during that time are down a paltry 1 percent, Mr. Thompson said.

Our financial health continues to be very good, he said. We have had a tight belt here for a long time. As a result of that, we are continuing to provide service levels that we have in the past.

Anticipated revenue reductions for 2009 are concentrated in inheritance tax revenues, investment interest, and grant receipts. During 2008, the village collected $1.14 million in inheritance taxes.

During 2009, village officials predict to collect $500,000 through the tax.

Interest revenue is projected to decline 25 percent from $438,000 in 2008 to $350,000 in 2009. The village is also predicting grant revenue will decline about 75 percent, from $101,500 to $25,000.

As a result, there will be less money for road projects next year. The village has reduced its budget for road work by 74 percent, from $1.78 million to $475,000.

Only the first portion of Orchard Road will undergo significant repair in 2009, compared to three major projects this year, Ms. Urbanik said.

Village council s budget will also see a reduction. Council s budget will be reduced almost $30,000 from $77,585 to $48,085. Less money is needed in 2009 because last year s council budget paid for the creation of a new Web site for the village, Mr. Thompson said.

The fire department will also see $25,960 in reductions, bringing the department s budget from $935,940 to $909,980. The change reflects money that was spent on a new vehicle, Mr. Thompson said.

Meanwhile, the village has earmarked more money for police protection, recreation, and trash collection.

The police department will receive an additional $8,645. The increase, from $1,203,790 to $1,212,435, is concentrated in personnel expenses.

Spending will rise $10,695 in parks and leisure, from $321,250 to $331,945. More money will be devoted to capital improvements at village parks.

Spending for trash collection increased $5,800, from $276,425 to $282,225. Operating and maintenance costs are to blame for the increase.

Contact Angie Schmitt at:aschmitt@theblade.com or 419-724-6104.