Ocean View hears revenue prospects

Ocean View Town Council applauded departing Planning and Zoning (P&Z) Commission Member Jeanne Mueller at the top of the June 7 council meeting, and sailed unruffled through another hour and a half of business. Things wrapped up on a lively note, though, with comments on a potentially faulty town budget structure from Cliff Mitchell, and an offer of big revenues from Bob Thornton (both town residents).

Mitchell said he’d reviewed minutes from past meetings of the town’s long-range financial planning committee. That committee meets through the winter months every year, in preparation for budget hearings in the spring.

This year, the committee did recognize that, with build-out at Bear Trap, real estate transfer tax and building permit revenues would drop.

Other than a slight increase in building permit fees, primarily to support the Millville Voluntary Fire Company and ambulance service, the town maintained the status quo this year — but committee members did mention possible changes for the future (including possible tax hikes).

Mitchell revisited that discussion. “Over the past five years, we’ve accumulated a total surplus of $3.4 million, mainly from real estate transfer taxes, mainly from Bear Trap,” he said. “The year we’re in now, we’re looking at a $1.3 million projected deficit.”

There was no immediate crisis, Mitchell said — as noted, the town still had plenty of money in accumulated reserves.

However, he predicted the situation would only get worse over the next five years, unless the town started making some changes. Mitchell noted the financial committee’s own report, which showed deficits near $400,000 as far out as fiscal 2010-2011.

He anticipated a complete draw-down of the reserve funds by 2015. The solution — increase revenues, and take a look at cost structures as they supported current levels of service, he said.

Mitchell suggested the council reactivate the financial committee now, to work in parallel with the $2.9 million police station project, poised to enter the construction phase.

Council members agreed that might be a good idea, but Meredith said it could be hard to find volunteers during the summer.

Council Member Eric Magill suggested the possibility of reconvening the meeting on a quarterly basis, to review any trends that may have begun to affect the underlying budget structure.

In the end, council decided to ask the committee members if they could reconvene in September (they usually wait until December).

At that point, Thornton made a suggestion — annex his development.

He said he was offering this strictly as an eight-year resident of Ocean View, who loved the area and intended to stay right where he was, but hated to see the town struggling financially when he was in such a great position himself.

“Looking at your anticipated income stream over the next five years, it may be you’ll be looking to generate new revenues, as opposed to getting the axe out,” Thornton said. By annexing his Silver Woods project — a 357-lot subdivision south of Bear Trap, with estimated selling prices in the $750,000 range — the town would pick up $4 million in real estate transfer taxes alone, he said.

Thornton said he didn’t care one way or the other, and nothing that happened was going to hurt his feelings any. He was already approved in the county, he’d already installed 12-inch water mains, he’d already built a wastewater lift station — in brief, Thornton said he expected to sell more than $200 million real estate, either just south of, or within, Ocean View.

There was some debate at the council table as to whether this was the proper way to introduce a request for annexation — Magill advised him that this should be handled in the form of a formal application.

However, Thornton said it wasn’t a request for annexation, exactly — it was more like an offer. “The county’s already in great shape — and I’d hate like heck to see my own town maybe have a problem in the future,” he said.

Council agreed to set the matter for discussion at the Tuesday, June 21 workshop (7 p.m., Town Hall, 32 West Ave.).

Returning to the top of the agenda, council considered a possible engineer-on-retainer, ok’d Frank Duchene’ consultancy contract through the end of the permitting process for the new police station and introduced five ordinances.

The ordinances will cover (1) annexation of the portion of Lord Baltimore Elementary School currently resting in the county, (2) fines for construction outside the hours permitted for those activities, (3) formal institution of the five cents per square foot fee increase for building permits, (4) formal authorization to borrow $2.9 million to build the police station and (5) addition of establishments “engaged in the sale of alcoholic liquor, beer, wines and spirits for off premises consumption” to the list of conditional uses.

Those ordinances should return for first readings at the Tuesday, July 5 council meeting.