Basic Budget Terms
Bond: A loan investors make to a municipal government.
Capital Improvement Project: Projects that help maintain or improve Borough assets. Large portions of the Borough’s capital improvement projects include infrastructure improvement. In order to be considered as a “capital improvement,” an asset must cost over $5,000 and have a useful life of over one year. The Borough’s capital items have useful lives from five years (vehicles) all the way to fifty years (land improvements).
Deficit: When expenditures exceed revenues
Expenditures: Money paid out by the Borough.
Fund: A source of money that is allocated for a specific purpose.
Fund Balance: How much money is in an account after expenditures are taken from revenue.
Intergovernmental Revenue: Money the Borough receives from the state and local government.
Reserves: Money left in a fund after all expenditures have been made.
Revenue: Money the Borough receives from taxes, fees, fines, grants, transfers, and sales
Surplus: When revenues exceed expenditures.
Frequently Asked Budget Questions
Q: How is the Borough’s budget developed?
A: The Borough’s fiscal year is the same as the calendar year and runs from January 1 through December 31. According to the Borough’s Home Rule Charter, the Borough manager must present a budget to Borough Council before December 1 for the following fiscal year. The proposed budget must provide a complete financial plan for all Borough funds and activities. Borough staff begins planning the operating budget in the summer months while the Finance Director develops revenue estimates for the next year. A proposed budget is drafted and presented to Borough Council. Council will hold budget hearings in mid-November to discuss the budget and then hold a public Budget Hearing in December and adopt the budget at December’s Council meeting.
Q: Is the budget balanced?
A: Yes. The Borough’s Home Rule Charter requires the proposed budget to be balanced, meaning revenues equal expenditures. A budget can also be defined as balanced if revenues exceeded expenditures, creating a surplus, or if fund balances from previous years are used in conjunction with revenue to equal expenditures. The Borough’s 2019 budget is balanced under the first scenario, revenues equal expenditures.
Q: Can I view a copy of the 2019 Budget?
A: Yes. We have a copy of the proposed budget on display in Town Hall at 53 West South Street. You can view it during our regular business hours: M-F, 7:30 AM-4:30 PM. It is also available for viewing on our website: https://www.carlislepa.org/wp-content/uploads/2018/11/Proposed-2019-Budget-11.5.2018.pdf.
Q: Why do I pay so much in taxes?
A: While you pay your tax bills directly to the Borough of Carlisle, the Borough actually only collects a small portion of those taxes. The rest goes to the Carlisle Area School District, Cumberland County, and the Cumberland County Library System. The budget and tax rates for the Carlisle Area School District are set by the independently elected School Board and not the Borough. The budget and tax rates for Cumberland County are set by the independently elected County Commissioners and not the Borough. The Borough has no say in either of these issues.
Cumberland County provided this breakdown of where taxes go in their annual financial report. The Borough receives 10 cents from every dollar of real estate tax paid.
Q: What do my Borough tax dollars actually pay for?
A: The Borough’s portion of your real estate taxes go into the General Fund. The General Fund is the Borough’s chief operating fund. It funds police, fire, parks & recreation, and roads to name a few.
Q: How does the Borough fund other services like trash or parking?
A: The Borough’s budget consists of six primary operating funds dedicated to different services:
General Fund: Includes administration, finance, fire, police, public works, parks & recreation. Sources of revenue for the General Fund include real estate taxes, earned income taxes, local services taxes, and intergovernmental revenue.
Water Fund: Includes financing of water and related services to the Borough, its residents, businesses and various customers within the proximity of the Borough. Sources of revenue for the Water Fund include residential and business utility bills, service charges, bond proceeds, and the fund balance.
Sewer Fund: Includes financing of wastewater collection, conveyance, and treatment services for the Borough, its residents, businesses, and various customers within the proximity of the Borough. Sources of revenue for the Sewer Fund include residential and business utility bills, lab analysis charges, intergovernmental revenue, and bond proceeds.
Stormwater Management Fund (New for 2019): Includes financing of stormwater management and related services. The Stormwater Management Fund will be financed by the Borough’s new stormwater fee, which charges property owners based on the amount of impervious surface area on their property, as well as bond proceeds.
Solid Waste Fund: Includes trash and garbage removal for the Borough, its residents, and commercial establishments throughout Carlisle. Also pays for operation of the Borough’s compost facility. Sources of revenue for the Solid Waste Fund include the sale of Borough trash bags and recycling bins, as well as intergovernmental revenue.
Parking Fund: Includes the regulation and control of vehicle parking in a garage, various parking lots, and parking meters throughout the Borough. Sources of revenue include proceeds from parking meters, Borough-owned parking lots, and the Pomfret Street Parking Garage.
Q: What does “intergovernmental revenue” actually pay for?
A: The Borough receives highway aid fund money from the state. This money must be used for activities dealing with public streets, bridges, street signs, traffic signals, and street lighting. The Borough benefits from a state recycling grant as well that helps offset the cost of the recycling program. The Borough also receives money from the state for contribution to Borough pension plans. The Borough also qualifies to receive funding from the federal government in the form of the Community Development Block Grant (CDBG) program. CDBG money is used in low- to moderate-income areas to fight blight and improve the community.
Q: Why do you have a fund balance? Isn’t that extra money that the Borough could use instead of increasing taxes or fees?
A: It is Borough policy to maintain reserves based on a percentage of annual operating expenditures. The Borough aims to have a reserve of 25% for the General, Water, and Solid Waste Funds and a reserve of 50% for the Sewer and Parking Funds. This ensures the Borough has enough emergency reserves for any short-term risks or unexpected expenditures. This allows the Borough to handle an emergency without incurring unplanned debt, which could raise costs in the future.
Q: If the Borough is facing a deficit in the General Fund, can they borrow from one fund to another, rather than raise our taxes?
A: No. Each fund is a separate financial entity. Money can be transferred between funds to pay for shared services and resources, but money cannot be mixed between funds. For example, money from the stormwater fund could not be used to purchase a police vehicle. Each fund must be self-supporting.