Talks focused on a possible rate hike for electricity, pension plan options, police department requests for additional manpower and equipment, and salary increase percentages.

Council Vice President and Chairman of the Revenue and Finance Committee L. James Roberts spearheaded the forum, which began with discussion of an increase in electricity rates.

By: Lauren Fitzsimons

Quakertown Borough Council met Monday night to discuss the 2007 budget.

Talks focused on a possible rate hike for electricity, pension plan options, police department requests for additional manpower and equipment, and salary increase percentages.

Council Vice President and Chairman of the Revenue and Finance Committee L. James Roberts spearheaded the forum, which began with discussion of an increase in electricity rates.

Last year, Roberts explained, the borough absorbed the cost of a late increase of 5 percent imposed by the borough's supplier.

"It cost us half a million dollars," he said.

To recoup that $500,000, the borough would have to raise the electric rate by 5 percent for 2007.

However, Roberts continued, "if we were to raise the electric, not 5, but 7 percent, we would bring in about $800,000."

The additional revenue generated by the electric rate hike would help offset several impending increases in the areas of healthcare, pension, and police department needs.

Healthcare premiums will rise 16 percent for 2007, if coverage remains the same as in 2006. Pension contributions will also escalate for the upcoming year.

"In 2004, no money whatsoever came out of borough revenues for pension," Roberts said. "It starts in 2005 with $142,000, '06 it's roughly $200,000, and in '07 it's going to be $364,000."

As for the police department, Chief Scott McElree has requested money to employ an additional officer ($62,782) and install mobile data terminal units in every vehicle ($64,320).

The terminals, in use by just about every police department in the county, will give officers access to the various databases and records through an Internet connection in their vehicle.

Without the additional 2 percent increase in electric rates, the borough would be forced to consider other options to cover these costs, such as an increase in the water and sewer rate, an increase in millage, or the establishment of an emergency services municipal tax.

Of those options, the tax would be the most likely, taking $52 per year from workers in the borough earning more than $12,000 annually.

Councilman David Wilsey favors the electricity rate increase over instating the tax, since electricity usage "is something the residents have control over."

Councilman Donald Rosenberger agreed adding, "The reason I would like to stay away from adding another tax is once you have it, it never goes away."

On the contrary, electric rates can be lowered in the future.

The borough is also exploring ways of cutting expenditures by altering the method by which contributions to employee pensions are made.

"Most municipalities have a defined benefit plan," said Borough Manager David Woglom, which consists of a minimum municipal obligation calculated by using a formula that assumes retirement to determine the contribution for each member in the plan. "What more municipalities are starting to look at," he told council, "is what is called a defined contribution."

Similar to a 401K plan, defined contribution plans allow the employer to set a yearly contribution amount made on the employees' behalf. The employee then decides how that money is invested.

Woglom, as directed by council, will be looking into the legality of such a plan, and requesting proposals for a related feasibility study.

As the meeting came to a close, council asked Woglom to return to them a revised budget containing the electricity rate increase, the $128,000 for the police department, $10,000 for the feasibility study, and a 3.7 percent increase in salaries.

The next budget meeting will be held on Nov. 21 at 7 p.m.

Lauren Fitzsimons is a freelance reporter for The Free Press.

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