On Monday, March 9, City Manager, Hans Medlarz, presented City Council with a Police Department Decision Matrix that explained the funding of the police department. The presentation was created as part of the city’s ongoing negotiations with the police officer union regarding a new contract for the town’s police force.
“Funding for the police department comes from three main sources,” Mr. Medlarz explained. “Property tax, realty transfer tax and fines. Over the past four years, the city has been required to transfer $2.2 million out of the realty transfer tax account into the general fund in order to cover operational costs of the police department. At this rate of transfer, which averaged $500,000 per year, the fund could be depleted within the next five years.”
Mr. Medlarz explained that transfers from the realty transfer tax account can only be made for capital improvements or public safety. He said this means that the transfers made each year have been almost entirely for the police department, although some capital improvement transfers were made for Parks and Recreation projects over the past five years. Councilman Dirk Gleysteen asked if the new Bayhealth campus would help increase the realty transfer tax account and Mr. Medlarz explained that it would not.
“Realty transfer tax comes from the sale of houses,” Mr. Medlarz said. “The new campus could increase the city’s property tax collection as people move into the area and purchase homes, but that will have no effect on the realty transfer tax.”
The negotiations and amount of increase the union is requesting are confidential, but Mr. Medlarz presented slides that showed that the city is unable to increase expenses for the department without increasing income sources.
“The only income source for police that the city controls is property tax,” Mr. Medlarz said. “They cannot change the realty transfer tax and they cannot change the fines levied in the city. Those are both state controlled funding sources.”
According to the information presented to city council, Milford collects $3,488,000 in property taxes. A comparison to cities of a similar size to Milford showed that Smyrna collects $2,753,382 while Seaford collects $2,392,330. This means that Milford collects an average of $129,185 in property tax for each officer on the force, compared to Smyrna at $125,154 and Seaford at $108,742. Milford’s property tax per resident is also higher than Seaford or Smyrna at $359.25.
After Mr. Medlarz presented the information, City Council adjourned to Executive Session to discuss the negotiations as well as information that was confidential regarding salaries. There was no action taken on the police contract after the Executive Session.