Grosse Pointe Farms Approves Flat Budget

city council approved their 2012/13 fiscal year budget this week following a public hearing. The budget calls for $12.4 million, no change in tax rate and maintains a healthy fund balance. 

Farms Controller and Treasurer John M. Lamerato said the budget is pretty much flat, meaning there were not gaps to fill. The Farms did experience a slight increase in its general fund of about $9,600, he said, which accounts for about 0.1 percent of the total budget.

In addition to maintaining the tax rate at 14 mills, the Farms will be completing a $500,000 street resurfacing project during the year as well as $64,000 in sidewalk repairs, Lamerato said.

The streets that will be resurfaced are those that have been identified as having the most need for it, he said, explaining the city maintains a list of streets that are in need of repairs prioritizing by the condition of the street.

The streets include:

• Chalfont
• Mt. Vernon
• Colonial Court
• Dean Lane
• Mack Avenue alley that lines the back of the commercial district

Lamerato said the average homeowner will see a reduction in city taxes of about $63 due to the market value decline.

Meanwhile, the water rates will be increasing in the coming year due to a decline in water usage, the need to fund approrpriately the retireement and retiree health care, funding needs for water system improvements and the $165,000 debt service the Farms is taking on related to some of the upgrades at the Kerby Road pumping station.

Based on average household water consumption rates, bills are expected to increase about $37 per billing cycle, which is changing from quarterly to bi-monthly--meaning residents will receive a bill every other month rather than every three months.

The Farms also has a fund balance of about $2.8 million, which Lamarato said accounts for about 22.6 percent of the budget. Finanicial officials recommend city's maintain a fund balance between 10 to 20 percent generally for economic vitality and positive bond ratings.

Lamerato said the Farms is a bit above average when it comes to the fund balance, describing it as healthy but said it is not a bad thing.

According to document highlighting the proposed budget, public safety is the highest expense at $4.6 million and the municipal court is one of the lowest at $252,000. Meanwhile, the highest revenue generator for the Farms are taxes at $9.2 million while charges for services is next at $1.3 million.

Councilman Louis Theros, who is the chairman of the finance committee, presented the budget to the council and the public this week. The Farms has posted a draft of the 2012/13 fiscal year budget on its website, where previous years budgets can also be found.