Mayor Warns Tough Decisions Need To Be Made On City Budget

City Considers Railroad Offer To Remove Broadway Crossing

Robert Moore

Herald Staff

rmoore@harrodsburgherald.com

Facing budget shortfalls due to the COVID-19 pandemic, Harrodsburg Mayor Art Freeman is asking the Harrodsburg City Commission to look at cutting their department budgets as well as other solutions, including possibly raising taxes.

“It’s going to be a pretty big shortfall,” Freeman told the city commission at their Monday night meeting, which was held via the Zoom meeting app and broadcast over Facebook. The mayor estimated a 30-40 percent decline in revenues, not just for the current budget year, which ends July 1, but the next fiscal year.

“We’re going to have to do some stuff that nobody seems to want to do,” Freeman said. He said that includes revenue increases. Last year, the commission voted to keep the property tax rate the same as the year before, at 66.8 cents per $100 in assessed value. While only four people showed up for a public hearing in 2019, opposition from those in the audience as well as from some city commissioners made them keep the rate the same. As a result, the budget was reduced by $70,000. In 2018, the city had to cut $750,000 from the budget.

Freeman said those who have seemed to be allergic to tax increases in the past “might have to take some Benadryl.

“All options will be discussed and considered.”

To prevent the spread of the disease, Kentucky, like most states in the nation, shut down most public businesses. While at least one study conducted by the University of Kentucky suggests the measures taken by Gov. Andy Beshear have helped “flatten the curve” and prevent medical services from being overwhelmed, they have also had an economic impact.

According to a press release from the Kentucky League of Cities, cities across Kentucky are facing an estimated collective budget shortfall of $85 million in fiscal year 2020 as a result of lost tax, utility, and other revenues. The KLC projects fiscal year 2021, which begins July 1, to be even worse, with cities facing a $180 million budget shortfall without action by the federal government.

On Monday night, the commission also voted to allow local eateries to continue not paying the restaurant tax into May. Back in March, the commission voted to allow local restaurants to not pay their restaurant taxes for March and April to the Harrodsburg-Mercer County Tourist Commission and urged the Tourist Commission to refund to existing restaurants taxes collected from December 2019 to February 2020.

Mayor Freeman also said the Tourist Commission, which currently has no employees, wants the city to take over collection of restaurant taxes on June 1. Since the tax was created, the revenues have been split 50-50 between the Tourist Commission and the city. Freeman said if the city takes over collecting the tax, that split would need to be reconsidered.

Commissioner Marvin “Bubby” Isham moved to have the restaurants collect the tax for May but not send it in. The motion passed unanimously.

In other business, the Harrodsburg Board of Commissioners:

• Is once again considering closing the East Broadway Street railroad crossing.

Mayor Art Freeman said Norfolk Southern considers the crossing unsafe, which is the same reason the railroad gave for wanting the crossing closed when they approached the city commission in 2017. However, no one could remember an accident at that location beyond a recent incident in which a driver parked too close to the railroad, which city officials say could have happened even if the crossing is closed.

Back in 2017, it was estimated the crossing was used around 500 times a month.

This time, Norfolk Southern is proposing to pay the city $35,000 plus $7,500 for safety, according to Mayor Freeman. In addition, the railroad said they could close the crossing any time they wanted. They also claim to own some of the land that the nearby houses sit on. Freeman asked the commissioners what they wanted to do.

Commissioner Charlie Mattingly said the public needs to be made aware of it before they vote. At the public hearing held in 2017, three local property owners all spoke against closing the crossing.

Commissioner Scott Moseley asked if Norfolk Southern would offer another crossing at another time if it is needed for economic growth. This was part of the offer the railroad made in 2017, although the city and Norfolk Southern could not agree on the terms. Mayor Freeman said he didn’t know how the railroad could guarantee a crossing at a future date, but said he would ask. The commission took no action.

• Approved a contract with Springbrook Interactive Voice Response for $4,000 a year, based on data usage. The automated system can accept payments made the over the phone and handle customer inquiries. It can also send out automated payment reminders. Officials say the system is cheaper than Code RED, once the city gets out of the contract. Amy Kays-Huffman, the water administration supervisor, said the city is reaching out to customers for more up to date contact information to make sure the city’s database is accurate.
• Discussed installing portable toilets downtown after receiving complaints from local businesses about people relieving themselves. However, the commissioners took no action due to concerns about the port-a-johns.
• Awarded bids to Hawkins and USALCO for chemicals and to Fouser Environmental Services for laboratory services at the water treatment plant.
• Agreed to advertise for bids for municipal aid street paving and for paving for Beaumont Avenue using state grant money. This year, the city intends to pave Tapp Road from US 127 to the back entrance of old Mercer School gym, Virginia Avenue from Parkwood to the dead end, Parkwood from Virginia Avenue to Palomino Street, Agee from Virginia Avenue to the joint and Greenville Street from Lexington Street to Popular Street.
• Moved to pay Devine Creations for weed eating at the cemetery.
• Hired Ethan Lewis as a public service worker II at the cemetery department at $12 per hour pending background check and drug screen effective Monday, May 18.
• Approved a $2,400 bid per weed eating at the cemetery from Reliance Works Property Maintenance.

The next meeting of the Harrodsburg City Commission will be on Tuesday, May 26, because of the Memorial Day holiday.