By Meg Peters
Review Staff Writer
In preparation for fiscal year 2015 Orion Township is beginning its budget proposal process with a nearly balanced budget, if not completely on target, according to Treasurer Mark Thurber.
With three fund accounts’taxes, water and sewer, and the general fund’the township looks to start the year with an overall surplus and minimal deficits by department.
The 2015 budget deadline is’December 31, however, Thurber predicts budget approval near Thanksgiving. He expects 2014 final numbers to be ready in March 2015 after assessing final costs and revenues at the year’s end.
The general fund
The proposed total expenditures for 2015 in the general fund are $6,288,664 as of the introductory budget session September 4. Estimated revenues reside at $5,045,364, including a conservative estimate of $50,000 in general fund interest, which would produce a deficit of about $285,555.
These numbers are preliminary and based on current 2014 expenditures and revenues, along with final amounts from 2013, therefore apt to change.
‘I know there is going to be more revenues than we planned on, and if we are off by 200k that’s not much of an adjustment, so were right in the neighborhood of a balanced budget coming out of the gate,? Thurber said.
Such revenues not included in the projected 2015 earnings include a host fee supplied by Eagle Valley, which amounted to about $1,838,027 in additional funds in 2013, to be used on safety and capital improvement projects.
The host fee could potentially be used to build the new Fire Station #2 to be on Giddings Rd., instead of depleting the general capital improvement fund. Total expenditures for the general capital improvement fund (a department within the general fund) are estimated close to $1.7 million for 2014’s close largely due to the fire station. So utilizing the Eagle Valley host fee would help prevent more depletion of this fund in 2015.
While the one mill Fire Operation Millage passed in August will fund the hiring of additional fire department staff, it cannot be used for capital improvement projects’the new fire station’or equipment. The .6 mills proposed for the’November 4’general election would fund equipment purchases and also the completion of Fire Station #2.
‘This is one scenario of if we don’t get the millage passed, then basically we will deplete all of our funds in the fire capital improvement fund.?
Water and sewer fund
The general fund is about one tenth the size of the water and sewer fund, with the latter expected to garner approximately $570,000 in interest in 2015, Thurber projects.
‘It’s a carry-over but I’m going to have better interest rates in 2015, so it’s just a starting point. I’m fine tuning it and it’s going to be tuned up,? he said.
Thurber sold off three mutual funds in late July, earning a profit of nearly $87,000 from the funds, he estimates.?’Several bonds invested in the water and sewer fund will produce the $570,000 in interest savings for 2015, a conservative figure. Thurber has approximately $34 million wrapped up in bonds.
This chunk of money will roll over with the overall water and sewer fund balance of about $49.9 million into 2015.
‘Total expenditures were $10.14 million in 2013. But look at the balance we had.?’Even though we spent $10 million and only brought in $8 million, we have near $50 million in the fund balance, so it is not alarming,? Thurber said.
He predicts the township to end the year with a total of $9.63 million in water and sewer expenditures and roughly $8.44 million in revenues.
Tax fund
The summer tax collection deadline of September 15 will bring in more than $30 million, of which the township gets a very small cut, Thurber said.
On a yearly basis residents pay more than $60 million in taxes.
With two separate millages passed in the primary election in August’one mill from the Fire Operation Millage and .25 mills for the North Oakland Transportation Authority (NOTA)’residents can expect to see an additional 1.25 mill increase on their winter taxes, for a total of 8.587 mills.
Residents are in the process of paying a summer millage rate of 47.97 mills for non-homestead properties and 29.97 mills for homestead properties.
The winter millage rate is not set, however, because an additional fire millage and the Lake Orion school district’s non-homestead millage renewal could up the anty if passed’November 4.
Other info
The general fund balance does not include the police and fire millages estimated for the 2015 budgets nor the Special Assessment District (SAD) collection amounts because these funds are assessed on their own.
Some departments within the general fund are working towards self-sustenance, such as Community Programs, which is projected to cost close to $719,000 in expenditures with $231,000 in revenues for 2015.
If the proposed .6 fire millage is passed in November, an additional $830,000 will be brought to the township (not including the Downtown Development Authority tax capture) . The one mill that was just passed is expected to bring in roughly $1.4 million for operations and additional staff.
Concerning housing development, another hot topic Thurber added, if 800 new homes are purchased over the next couple years, at an average value of $300,000 each (or $150,000 in taxable value), Orion Township would collect an additional $3.6 million in taxes if all are homesteads.
Orion Township is holding the 2015 Budget Public Hearing Monday, September 15 at 7 p.m. at Orion Township Hall. The township must submit the 2014 millage rates in support of the 2015 budget to Oakland County by’September 30.