City has to shore up budget deficit with millions from Rainy Day Fund

Property taxes will increase less drastically this year than in previous years, but city leaders had to use millions in reserves to make ends meet.

To meet this years fiscal year 2011 budget, Mayor Tom Ambrosino said they would have to tax to the levy limit and then shore up a huge deficit by using $2.814 million from the Rainy Day Fund.

It’s a scenario that isn’t so good for the City’s balance sheet through the eyes of Wall Street, but is not such a bad thing for the wallets of local taxpayers.

On Monday, the City Council made a couple of votes that affirmed the preliminary tax rates, which still have to be approved by the state.

The residential tax rate this year will be $14.44 per thousand dollars of value. The commercial rate will be $29.31 per thousand dollars of value. The tax rate is combined with individual property values to determine the amount owed on the property tax bill.

So, for example, if a home is valued at $200,000 by the city, one would multiply 200 by the residential tax rate, which will be $14.44.

On the average, taxes will be static.

Some people may see tax increases; others might see tax decreases. However, on average, most will see only slight increases. That was also the case last year, when property taxes stayed mostly the same. Seemingly, the days of 10 to 20 percent tax increases every year are as far gone as the days when simple ranch homes in Ward 6 sold for half a million dollars.

Certainly, the two circumstances are linked.

The numbers for this year’s tax bills work out something like this.

On average, the single-family tax bill will go up by $25, or 0.75 percent. A two-family home will see an increase of $62, or 1.5 percent. Three-family homes will increase by $22, or 0.54 percent.

Condo owners this year will see a decent decrease, on average, in their tax bills. Condo owner bills should decrease by $66, or 2.4 percent.

The unfortunate thing about the entire situation is that the city is having to use a substantial amount of savings to bring the budget in line. It’s pretty much the first time that the Rainy Day Fund has had to be tapped. Last year, as hard as things were for the City, it was able to wiggle out of using any savings.

This year, though, is a different story.

Next year, Ambrosino said there should be enough savings to carry them through another tough budget year.

After that, in fiscal year 2013, there will be no savings left and there will have to be a dramatic turnaround in the economy.

“If things don’t pick up by then, we won’t make it,” said the mayor.

2 comments for “City has to shore up budget deficit with millions from Rainy Day Fund

  1. Billy Bell
    November 26, 2010 at 12:07 pm

    I think that the elected oficals have to start cutting out waste now instead of waiting when its too late.There are savings if our elected officals look hard enough. And no new schools etc when the City of Revere is bleeding. from Billy Bell

  2. Stephen DiCologero
    January 27, 2011 at 6:11 pm

    “The unfortunate thing about the entire situation is that the city is having to use a substantial amount of savings to bring the budget in line. ” Yet, no one talks about the exorbitant salaries on the City’s payroll. Do you really need to pay a 3rd year police officer over $100K? or a Superintendent of a School System consisting of less than 10 schools nearly $200K…with an assistant no less, getting nearly as much!?! The people in Revere that put up with the incremental tax increases to support such excess are like the frogs in the warm pot. Slowly turning up the heat the frogs stay in until they boil to death. No one complains because it is small increases. I’m not there anymore but I do have family there and I find this repugnant. I can tell you, Revere has a reputation of being one of the most corrupt places in the country. Try as I may to counter such talk, this does nothing to dispel these claims. Attempting to show how fastidious and conservative of the peoples money all the while fleecing them borders on being down right evil.

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