Avon
By Rebecca Turman
Avon city officials are expecting several cuts at the state level to impact the revenue stream in next year?s budget, but increases are expected in other areas.
Earlier this month, Avon City Council approved the city?s preliminary budget for the 2013 fiscal year.
The preliminary 2013 budget, with estimated expenditures totaling approximately $65.2 million for Avon, had to be delivered to the county auditor this month.
Avon Finance Director Bill Logan explained some of the factors that will impact the 2013 budget.
?They are reducing what?s called the Local Government Fund again,? Logan said in a recent interview.
According to Logan, the fund was already reduced 25 percent, and will be reduced another 25 percent in 2013. Logan noted the state budget runs from July to June, while Avon?s budget runs from January to December.
?After June it will be like a 50-percent reduction in Local Government funding,? he said. ?This year is affected by $78,000. Next year it will be about $130,000.?
The other state cut that will have an impact on Avon?s budget is the elimination of the estate tax, or the death tax, Logan said.
In the past, Logan said he typically budgeted between $200,000 and $300,000 in revenue each year from the estate tax.
Logan said the cut will go into effect in 2013, but only pertains to deaths in 2013.
?That is very unpredictable,? he said of putting a dollar amount on the cut. ?I think I put $100,000 in for it next year.?
When it comes to income tax, Logan said for the 2012 year, the city will end up at about $10.9 million in revenue.
?Next year is probably about 3.5 percent over that,? he said of the projected increase in the income tax. ?The (Cleveland) Clinic is definitely contributing to that.?
Predictions for property tax revenue are harder to make for the 2013 year, Logan said, considering the taxes are up for a six-year reappraisal this year.
Depending on what happens with the values, they won?t be finalized until October, he said. For now, he budgeted the same dollar amount that was allocated for this year ? $5.2 million.
?That will change as we get more information,? Logan said.
Tax Increment Financing revenues are expected to increase about $1 million in 2013, Logan said, from $2.8 million to $3.8 million.
?That includes the school share of that,? he said, adding the Avon Local School District receives about 64 percent of that dollar amount.
At this time, the city has not budgeted for any new hires during the 2013 year, but Logan said that could change before the budget is finalized this fall.
?There are some vacant positions we are looking to hire for, like the streets superintendent ? and an assistant utilities superintendent that was budgeted for this year,? he said.
Logan said he and council?s Finance Committee will hold meetings with department heads in the fall before finalizing the 2013 budget.
While the city is already preparing for the 2013 year, the Finance Department wrapped up on the 2011 city audit last month.
?There were no findings,? Logan said. ?There were a couple of what I consider minor recommendations, but nothing out of the ordinary.?
In a document signed by Avon Mayor Jim Smith and Logan, included in the 2011 Comprehensive Annual Financial Report, it states, ?The assessed valuation for tax year 2011 for the City of Avon is $772,474,470, per the Lorain County Auditor?s Office. Property taxes will be collected on this valuation in 2012. This is $7,288,780 less than the 2010 valuation, or about a 1 percent decrease. The assessed value equates to a little more than $2.2 billion at market, or appraised value.?
The valuation does not take in account the Cleveland Clinic, which, according to the document, adds about $35 million to the total. However, part of that amount may be determined tax-exempt, since the Cleveland Clinic is a nonprofit organization.
?Because the city has Tax Increment Financing (TIF) agreements in place for much of the commercial property north of I-90, these values are not included in the County Auditor?s total taxable assessed valuations,? the document states. ?The City and the Avon School District both collect Tax Increment Financing revenues as if they were property taxes. Presently, the city is collecting TIF revenues on an estimated commercial assessed valuation of about $25 million.?
Contact Rebecca Turman at rturman@2presspapers.com
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