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Proposed Lebanon budget includes layoffs, curtails projects

Valley News Staff Writer
Published: 11/9/2020 9:33:36 PM
Modified: 11/9/2020 9:33:30 PM

LEBANON — City Manager Shaun Mulholland is proposing to lay off three full-time employees, forgo hiring some seasonal recreation staff and trim $1.1 million in infrastructure projects as part of a 2021 budget he put forward last week.

The cuts, Mulholland said, are needed to prevent a sharp increase in property taxes and help pay down the debt stemming from the citywide combined sewer overflow projects.

That court-mandated effort to separate sewer and stormwater in 15 miles of Lebanon’s sewer system is expected to cost $75 million when it’s completed next year, with much of that money coming due soon.

The city will see its debt payments rise in 2021 to $10.1 million.

That’s a 31%, or $2.4 million, increase over this year.

In the subsequent three years, debt payments will rise by 16.4%, to $11.8 million annually.

“Our debt load is significant,” Mulholland said in a phone interview Monday.

Overall, the city manager is proposing a $61.5 million municipal budget for 2021.

That’s a $856,000, or 1.4%, increase over the current year’s spending plan.

The operating budget, which funds personnel and city departments, would see a 0.9% increase to $37.1 million.

As a result, residents would see the municipal portion of their property taxes increase by 3% to $10.27 per $1,000 of a property’s assessed value.

That rate, which doesn’t include payments to the school district or county, would amounts to a $77.50 tax increase for a property valued at $250,000.

Mulholland said the debt payments and the possibility of revenue shortfalls associated with the COVID-19 pandemic forced him to make tough choices on the budget.

While residents have been paying their property taxes, the pandemic resulted in restaurants and Dartmouth College making less use of the landfill — and paying less to drop off trash. Ambulance collections and motor vehicle registrations are down as well, he said.

The city manager’s budget would cut three employees — one in the assessing office and two in public works — and the city won’t rehire workers who usually man Lebanon’s Veterans Memorial Pool in the summertime.

Mulholland predicted the pool will remain closed next year because of the pandemic.

“It doesn’t take a whole lot for those revenues to hit us,” he said of the possibility of shortfalls.

The capital improvements budget, which pays for new buildings, vehicles and other city infrastructure, would be trimmed by $1.1 million under Mulholland’s proposal.

Lebanon would put $9.9 million toward those expenses next year, a decrease of more than $13 million since 2019.

The city’s debt payments are “going to force us to curtail capital projects for a while,” Mayor Tim McNamara said Monday.

He explained that the capital improvements budget is now tied to the number of bonds Lebanon plans to retire each year so that the city doesn’t take on additional debt.

“It’s definitely the big issue. (Debt) is a larger proportion of the budget and it is going to cause us to have to curtail and be really careful about the selection of capital projects going forward,” McNamara said.

However, the capital improvements budget includes at least one high-ticket item: renovation of the Lebanon Public Library. If it’s approved by the City Council, the spending plan will set aside $1.7 million to replace the HVAC system, improve its energy usage and implement a new layout at the downtown library.

There’s also $1.1 million set aside for improvements on Spencer Street, where a developer plans to build a four-story mixed-use building on the site of the former public works facility.

The operating budget includes a 1.5% salary increase for employees not covered under collective bargaining agreements, bringing Lebanon’s to $24.8 million, a 1.1% increase. It also maintains funding for two firefighters and police officers hired under federal grants that will soon expire.

Lebanon’s $6.2 million police budget, which is set to decrease by $112,560 next year, has come under fire from a group of activists who hope to cut it by 50% in the next two years.

The Upper Valley chapter of the Democratic Socialists of America unveiled a “Care Not Cops” proposal last month that calls for Lebanon to instead invest its money in social services, such as affordable housing, opioid treatment programs and homelessness outreach. Their plans will be discussed during a City Council meeting on Nov. 18.

People can find a copy of Mulholland’s budget proposal at lebanonnh.gov/201/Budget-Information.

The City Council, which started its formal review of Mulholland’s budget, will continue through mid-December. Public hearings are scheduled for Dec. 2 and 18.

Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.




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