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Mayor's Report for May 2002

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By Mayor Michael Herman

It is time for the annual town budget hearings on the proposed budget for the fiscal year beginning July 1. The past year has been a very difficult time for many small and large towns throughout the country. While nobody could have anticipated the events of September 11, the aftermath has caused financial chaos at all levels of government. All around us, municipalities are raising tax rates as revenues have shrunk considerably. State and federal grants are more difficult to come by and belt-tightening and fiscal austerity have been the words of choice. It is not a pretty picture nationally or regionally.

Fortunately, the Town of Riverdale Park has been able to maintain tax levels and service levels even while some of our neighboring towns have dramatically increased their taxes or significantly reduced services. In one instance, a neighboring town will increase its tax rate by more than 25% this year alone. Operating under a tax cap that has not changed for 8 years, Riverdale Park enjoys the lowest municipal tax rate of the 27 cities and towns in Prince George's County that offer full services (e.g., police, public works, code enforcement, etc.) to its residents. I am pleased to report that the proposed budget that I released in April continues that tradition of fiscally prudent management of our town.

In the proposed budget, I have significantly reduced projected revenues from red light cameras and other fines. In the current fiscal year, these were projected to produce more than $500,000. They are far less than that, due in part to the fact that red light running has been significantly reduced in the community. For the proposed year, I have projected a 50% reduction in these revenue sources. Notwithstanding increases in property values and the several significant redevelopment projects such as the town center and the proposed Eckerd store, revenues for 2002-2003 are projected to be slightly less than the proposed revenue for the current year. At the same time, the cost of delivering services will continue to increase due to wage increases (i.e., raises and cost of living adjustments), the proposed commencement of building inspection for multi-family homes and apartment buildings, and the increase in costs for supplies, gasoline and utilities. Overall, the proposed budget anticipates a modest 3% increase in expenses, far less than in recent years.

The budget picture is not rosy however. Included in the proposed budget is balancing the budget with $189,000 in revenues from the town's cash reserve or rainy day fund. While the expected budget shortfall is expected to be significantly less than that based on our past history, we must include this figure to balance the budget. However, this is truly the worst- case scenario on expenses, but we expect much less than that amount to be taken from the reserve. However, in the current fiscal year alone, based on fiscally prudent decisions during the year, expenses will be nearly $300,000 below the adopted budget, when the fiscal year ends on June 30. This savings was due in large measure to the hard work of our department heads who were directed to find ways to save money during the year. They will continue on a prudent fiscal track for the coming year as well.

The proposed budget does have a small increase in special assessments to cover the cost of new equipment in the public works department and a replacement of several police cruisers that have gone out of warranty. The new equipment includes leaf machines and a truck to allow the town to save money by doing its own tree trimming rather than contracting those services out. This special assessment increase will cost the average homeowner less than 75 cents per week and greatly increase our ability to deliver services in the town.

In order to stave off the large tax increases that are being proposed all around us, the current government has embarked on an aggressive campaign to promote business development and to expand the economic base of our town. The Town Council recently introduced legislation to annex commercial buildings on Kenilworth Avenue known as Jemal's Kenilworth Office Park. These buildings, worth almost $4 million, will increase our tax base by over $25,000 annually with little need for additional services. The economic development of the town center should produce almost that much annually when it is completed later this year or early next year. The proposed Eckerd store will likewise add significant revenue to the town, an estimated $35,000 per year. Another annexation on Good Luck Road of the Parkside subdivision is also underway, and will likely occur in the near future. These changes will improve the economic condition of the town, but alone, they will not prevent tax increases in future years unless significant other revenues are produced or services are reduced which is unacceptable. The town has committed its resources to make economic development a top priority. We recently hired a deputy administrator who will spearhead our economic development activities to refurbish existing commercial properties, attract new businesses and to seek grants for the town and its residents.

There is also an effort underway by residents in Riverdale Heights to become part of our town. Preliminary estimates show that if all the single-family homes came into the town, revenues would increase by more than $400,000 annually, while the additional costs of delivering services to these residents would increase the budget some $50,000 less than that. While we have not yet been presented with the annexation petition, this is one way we can grow our town more efficient and improve our economic condition at the same time.

Overall, we will weather the financial storm this year and next. The future of our town and its low tax rate hinges on important decisions that the mayor and council will be tackling over the next several months and years. Residents have asked me to maintain the level of the excellent services we enjoy in this town. I have every intention of keeping those services the best anywhere, and my colleagues on the town council are eager to see that as well. While we are not yet out of danger, the prospects for a brighter future look better than ever. Right now, we must stay the course and remain vigilant.


It is with a heavy heart I report the recent passing of William Wright, a long-standing resident of 48th Avenue. Mr. Wright was a resident of our town for more than 30 years. Almost two years ago, due to failing health, Mr. Wright was moved to a nursing home. Born in West Virginia in a log cabin in 1916, he was one of 12 children, and the last surviving until his death inMarch. The childhood home is now a state historic site. He was employed by the Civilian Conservation Corps during the Roosevelt Administration doing valuable public improvement projects during the Great Depression. He later worked for and retired from the WSSC. After retirement, he painted many of the homes in our community. Our condolences go out to the many who knew him during his long stay in our community.

[NOTE, if you have any recent death, birth or adoption announcements you would like to appear in the Crier, contact Mayor Michael Herman at 301-927-6381.]

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