The Commonwealth says Haverhill’s surplus now stands at a little more than $11.5 million and, in light of the current controversy over fire stations, the mayor says he’ll use $500,000 now to repair the Water Street fire station.
The remainder of the surplus—known as “free cash”—will be used to pay for an increased senior and veteran tax exemptions, add to the city’s “rainy day” fund and support next year’s budget. The state Department of Revenue certified the surplus last month and it comes just as the city’s property tax rates are to be set.
In a statement to WHAV, Mayor James J. Fiorentini said, “We will save most of the free cash for next year’s budget and our reserves, but right now I intend to recommend that we allocate $90,000 to give low-income elderly and veterans a tax break and set aside $500,000 to make necessary repairs and improvements to the Water Street Fire Station.”
The city recorded a surplus of $12.4 million at this time last year. A little less than half of the amount was used to balance the current year’s city budget. It became an issue last fall when city councilors and the mayor clashed over whether the city should tax to the state’s proposition 2 ½ limit. Fiorentini initially vetoed the council’s original plan would have taxed to the state limit. Following a compromise, councilors agreed to use $500,000 of the surplus to reduce the tax increase and $1.5 million for improvement projects, including repairs for the city’s schools.
A repeat is set to take place next Tuesday when the City Council holds a so-called tax classification hearing. Seemingly anticipating what Council President John A. Michitson has called “horse trading,” Fiorentini said, “Once again we now have enough reserves to invest in our schools and public safety departments next year, but it would be a mistake to spend all of our reserves.”