MINERSVILLE — The borough council is taking a long look at its spending to try to avoid situations like the 4-mill tax increase it approved in December 2016.
On July 11, the council hired a firm from Philadelphia, Fairmount Capital Advisors Inc., to help.
“They’re going to try to forecast to see what kind of revenues we should realize, or not realize. They also do trend analysis,” Robert G. Mahalchick, the borough manager, said Monday.
Fairmount will put together what’s called an “Early Intervention Plan Proposal and Five-Year Financial Plan” for the borough. Councilman Ian Mahal said Monday that 75 percent of the $50,000 project will be paid for with state funding.
This will also be part of a larger project, a step toward developing a new comprehensive plan for the borough.
The last time the borough made such a strategic effort was 1993. Mahal said he hopes the council can develop one within two years.
“Step one really needed to be the state’s Early Intervention Program and to have someone like Fairmount come in and go through our finances,” Mahal said.
In June 2016, the borough council expressed interest in the state Department of Community and Economic Development’s Early Intervention Program.
The EIP program provides matching grant funds — grants of up to $200,000, 50 percent of a total project cost — to assist municipalities looking to develop comprehensive multi-year financial plans and establish short- and long-term financial objectives, according to the DCED website.
The borough used funds from that program to hire Fairmount.
There were two bidders for the Early Intervention Plan proposal. Fairmount’s bid was $50,000.
“So, 75 percent, or $30,000, will be paid by a DCED grant. The other $15,000 is the borough’s match and will not need to be paid until 2018,” Mahal said Monday.
The other bidder was the Pennsylvania Economy League. Its bid was $64,375.
“I was expecting between two to five bidders,” Mahal said.
Mahal made the motion to hire Fairmount at the borough council’s meeting July 11. It was seconded by Jamie Kuehn, the council vice president, and carried unanimously by all council members in attendance. They included William Angelo, the council president, and members Katielyn Milbrandt, Walter Miscavage and Paul Vuksta.
Council member Jennifer Beach was absent.
Mahalchick anticipates there will be a conference with Fairmount’s representatives sometime this week, including Dan Connelly, Fairmount’s director.
On July 14, Connelly sent the borough a letter requesting financial information, including audits, detailed revenue and expense data, data on pensions and debt and any available information on department budgets and performance.
The study will also take into consideration the borough administration’s concerns about its borough hall and borough garage, which are side-by-side at 2 E. Sunbury St.
Mahalchick said the garage area doesn’t have proper ventilation, and there are issues with the roof.
According to a project timeline Fairmount provided, the study will be complete before the end of the year.
Before it’s complete, the public will be able to see a draft and submit comments. According to a schedule Fairmount provided to the borough, this may occur between Oct. 16 and Nov. 6.
Minersville has a population of about 4,400, Mahalchick said.
In 2016, the borough budget was $2,139,473 and the real estate tax was 16 mills.
This year, the borough budget is $2,286,241 and the real estate tax is 20 mills.
One mill generates $36,000 for the borough.
The tax increase was a result of a health care cost increase of $26,154.20, a recycling increase of $27,000 due to market conditions, a pension obligation increase of $6,719 and capital improvements of $55,126, Mahalchick said.
“Plus we moved $29,000 that was being used to pay for utility street lights. The funds were diverted back for street repaving and road repair projects,” Mahal said. “There were an assortment of reasons why taxes needed to go up. And we also knew that we’d have to put money aside in case we need a new borough hall or need to renovate this borough hall.”
“There are some structural issues. The roof’s in bad shape. If you look outside, the facade is starting to crumble,” Mahalchick said.
“Once we receive these recommendations from Fairmount, we will look to implement a multi-year budget. Obviously the budget gets voted on per year, but this will give us an idea of what the budgets for the next few years will look like,” Mahal said. “The decision to enter into the Early Intervention Program occurred before we raised taxes. However, we entered it as a proactive step forward to avoid future tax hikes, while maintaining sound fiscal policies that will allow for the continuation of key services, the development of a comprehensive plan, and the funding of capital projects.”
Contact the writer: spytak@republicanherald.com; 570-628-6011