Following the 60th Administration’s budget priorities which includes fiscal responsibility, economic development, public safety, the Mayor and Board of Aldermen approved the $137,362,981 million Fiscal Year (FY) 2013 operating budget ....
CONTACT: Susan Harding, Public Information Officer, 301-600-1385
FOR IMMEDIATE RELEASE Tuesday, June 19, 2012
The City of Frederick FY2013 Budget Approved
Frederick, MD -- on Thursday, May 17, 2012 while retaining a 12% fund balance for emergency expenditures.
Following the 60th Administration’s budget priorities which includes fiscal responsibility, economic development, public safety, the Mayor and Board of Aldermen approved the $137,362,981 million Fiscal Year (FY) 2013 operating budget
During these challenging economic times, the Mayor and Board of Aldermen has strived to provide critical public services that are at the highest quality to over 65,000 residents, 27,000 households and 3,500 businesses in our community. City officials wanted to continue to provide the same level of service while ensuring City taxpayers pay for the actual services they use. In years past, The City of Frederick has received a direct payment from Frederick County for the cost of services the County did not have to provide to County residents living in The City of Frederick. This direct payment to a municipality is known as a tax rebate.
In spring 2011, The City of Frederick and Frederick County Government began discussing the resolution of this long existing inequality in the property tax code. The City and County elected to use a property tax differential for residents who reside in The City of Frederick. Under this type of plan, the County tax rate is lowered to offset the cost of services not provided by the County for City residents.
To continue to provide the same level of service, The City of Frederick FY 2013 budget proposes to increase the municipal property tax rate by $0.08 while the County rate is decreased for City residents by $0.12. When City and County property taxes are combined, City of Frederick property owners will experience a $0.04 overall decrease in property taxes while continuing to receive the same level of service.
Pension and OPEB Reform:
The 60th Administration continued to make efforts to fund the City’s Pension and Other Post Employment Benefit (OPEB) liabilities.
The City adjusted the benefit formula for the twenty-five year and thirty-year pension plans. Based on an analysis completed by the City’s Actuary, the 25 year pension plan employee contributions increased from 7% to 7.5% of an employee’s salary, capping any cost of living adjustment to 2.5% and extending the amount of time it takes for an employee to vest in the plan to 10 years. These changes affect new employees after June 30, 2012.
The Mayor and Board of Aldermen modified the thirty-year pension plan, requiring employees contribute 1% of pay, capping any cost of living adjustments to 2.5% and extending the amount of time it takes for an employee to vest in the plan to 10 years.
In addition to these changes, the Mayor and Board are continuing to conduct a comprehensive review of employee and retiree benefits. The City recently launched the Ad Hoc OPEB/Pension Review Committee which is tasked with reviewing the City’s pension and post-employment benefits and coming up with a set of recommendations. The Ad Hoc OPEB/Pension Committee holds public meetings on a regular basis.
Continued Investment in The City of Frederick’s infrastructure.
a. Investments include building additional wastewater capacity that will allow the City to continue to grow as a community. The City has committed to fund the Gas House Pike Wastewater Treatment Plant and the Ballenger-McKinney Wastewater Treatment Plant improvements.
b. Increase road repaving program by forward funding the repaving of 5 City streets at a cost of $1,105,000 million.
c. Completion of Phase II of Carroll Creek Linear Park. This approximately $13 million project will trigger $100 million in private capital investment in properties located along this segment of Carroll Creek.
d. Assist the Hotel Work Group with the development of a full-service 200+ room downtown hotel and conference center with 15,000 square feet of meeting space to induce conferences and business meetings and over-night stays in downtown Frederick. The 17 largest employers in Frederick City / County support this economic development project.
1. The City obtained $250,000 matching grant from the Maryland General Assembly. This money may cover acquisition, planning and design (these funds could be applied to pay for design plans that highlight the placement and height of a facility to determine if the building will fit on a designated property (they are not detailed designs), geotechnical expenses (determine if a site is adequate))
2. The time-line is as follows; The selection of a site and development team in 2012, design and permit a facility, and develop a financing plan in 2013. Construct a facility in 2014 and open the doors in 2015.
e. Church Street Garage Rehabilitation Project will extend the life-span of this heavily used public facility in the heart of Downtown Frederick.
f. Provide partial funding for the shared-use bicycle and pedestrian tunnel that will eventually connect the shared-use path in Baker Park to Waterford Park and Rock Creek Park; allowing residents in our West End and Downtown safe bicycle and pedestrian access to their respective neighborhoods, shopping and places of employment.
To help maintain the high level of community policing we have always experienced in our City, the Fiscal Year 2013 budget includes the funding and equipping of 138 officers plus two unfunded positions and a 6 person police academy class in FY 2013. This is an effort to bring our uniformed force strength from 131 officers to 141 officers.
Based on Sperling’s “Most Secure Place to Live” statistical study, the City went from the eighth safest community to the fifth.
Part I Crime (UCR): Homicide; Rape; Robbery; Aggravated Assault; Burglary; Larceny-Theft; & Stolen Auto.
Data Source: US Census Bureau (1991-1999, 2010), City of Frederick Population Projections (2000-2009, 2011), FBI UCR (2000-2011)
Over the past twenty years, the population of The City of Frederick’s population has increased by well over fifty percent and a downward trend in Part I crimes is the result of the proactive efforts of the Frederick Police Department and the continued investment and job creation opportunities generated by the private and public sectors.
As the second largest City in the State of Maryland, we want to continue our efforts to drive Frederick toward future job growth and the time is now to lay the groundwork to make our community a leader for innovation. The Fiscal Year 2013 budget establishes a One Hundred Thousand Dollar ($100,000.00) business incentive match program that will, for the first time, allow Frederick-based companies an opportunity to receive a required local government match for State issued business grants and loans. This will allow Frederick companies to retain a competitive edge in the regional economy.
The following economic development programs and policies are going into effect before or shortly after the start of the fiscal year:
1. Fast Track Permitting: Establish a criteria-based fast track permitting system – using the long established Frederick County system as a starting point.
2. Historic Property Rehabilitation Tax Credit: Revise terms to be consistent with the other programs including making it a seven year program (it is currently a 5-year program) and offering similar credits as the other programs. Targets investment into downtown historic buildings.
3. Golden Mile Commercial Property Rehabilitation Tax Credit: Extend the rehabilitation tax credit for a seven year period. Targets investment along the Golden Mile.
4. Downtown Arts and Entertainment (A&E) Property Rehabilitation Tax Credit: Extend the tax credit for a seven year period and targets investment in the existing A&E District located in Downtown Frederick.
5. Vacant Commercial Property Rehabilitation Tax Credit: Extend the rehabilitation tax credit for a seven year period and revise terms to include applying it to multiple buildings on a single lot and with a rolling date. Targets investment into vacant commercial buildings citywide.
6. Brownfields Property Mitigation Tax Credit: The credit can be applied for five taxable years.
7. New Jobs Property Tax Credit Program: Targets job creation and investment resulting in tax revenues which will be a performance-based credit. To qualify, a business must:
a. Obtain at least 5,000 square feet of new or expanded premises and employs a minimum of twenty-five permanent, full-time positions during a 24 month period.
b. May receive a property tax credit for new or expanded premises for 52% of the assessment for the 1st and 2nd taxable years, 39% in the 3rd & 4th taxable years, 26% in the 5th & 6th taxable years.
8. Water and Sewer Impact Fee Payment Plan for Commercial and Industrial Properties: allow property owners or businesses to pay impact fees over a four year period.
The Mayor and Board of Aldermen continue to provide some financial support to dynamic organizations that enhance the quality of life and business competitiveness of Frederick. The following organizations received support in the Fiscal Year 2013 budget:
• The Downtown Frederick Partnership
• The Golden Mile Alliance
• The Tourism Council of Frederick County
• The Frederick Business Incubator - the Frederick Innovative Technology Center, Inc. (FITCI).
The FY 2013 budget boosts the Department of Economic Developments efforts to directly recruit businesses in critical industries, including biotechnology, information technology, retailing and defense.
The City of Frederick’s Fiscal Year 2013 budget will be available for viewing at www.cityoffrederick.com in approximately mid-August 2012.