City manager recommending budget with no tax increases; limited funds
Great Falls City Manager Greg Doyon is recommending a budget with no tax increase for the upcoming fiscal year, which begins July 1.
Doyon has said in public meetings for the last several months that he would be recommending a budget without tax increases for economic recover for the community due to the COVID-19 pandemic.
He’ll discuss budget options with the City Commission during their June 16 work session. During the same work session, staff will discuss funding options for the $5.5 million repair to the Civic Center facade.
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His recommended budget does not include increases for utility rates or property assessments.
The city is projecting an increase of $425,000 in newly taxable property, but the won’t be known until the Montana Department of Revenue sends the certified values in August.
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The fund balance for the general fund at the end of the current fiscal year, which ends June 30, is projected to be 17.2 percent. The recommended minimum policy of the city is 22 percent, which equates to about two months of operating expenses for cash flow needs, maintaining the city’s quality, low-risk credit rating and to address unexpected expenses.
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Without increased taxes and before addressing any critical needs, the fund balance is projects to be 14.6 percent at the end of the next fiscal year on June 30, 2021.
According to the staff presentation Tuesday’s work session, the fund balance has trended downward since Calumet Montana Refining began protesting their taxes in 2017.
The county tax appeal board voted in March 2018 to reduce Calumet’s valuation from $538 million to $312.5 million.
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That decision was been appealed by both Calumet and the Montana Department of Revenue to the Montana Tax Appeal Board. A hearing is set for Feb. 19, 2020 and then rescheduled for September, but Calumet and DoR have settled.
According to the DoR, of the roughly $17 million paid by Calumet under protest for tax years 2017-2019, about $9.5 million will be released to the local jurisdictions and $1.5 million to the state.
Those numbers include the payment for the second half of 2019, which isn’t due until May 31.
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The chairman of the state tax appeal board notified The Electric on May 19 of the pending settlement and The Electric has been requesting the breakdown of the distribution to the city and school districts since then.
DoR sent the notification to Cascade County on May 21, according to DoR, but the notification went to the clerk and recorder’s office instead of the treasurer’s office, according to Diane Heikkila, county treasurer.
Heikkila told The Electric on May 28 that her office now had the information and will process the protest resolution the following week to have details on the distribution to the other local jurisdictions then. The Electric followed up again on June 12 and has not yet received those details.
A spokesperson for Calumet said the company was pleased to reach a settlement with the state but wouldn’t release any other details.
City departments were asked to hold the line on any unspent appropriations this year and instead of the usual above and beyond request form, departments were asked to provide one or two requests critical to their operations that were not additional staff.
Of those, the city manager has identified three as critical needs for the upcoming budget year:
- Court recording system for Municipal Court: $29,000
- Fire Station 4 sewer repairs: estimated $220,000 but staff is hopeful the project will come in under budget
- Hardware and software to meet the State of Montana’s Criminal Justice Information System requirement: $35,000
- Total critical needs: $284,000
Other major expenditures in the FY 2021 budget include:
- Public safety radio system debt service: $231,571 annually;
- Union and non-union 2.75 percent cost of living increases;
- A 10.2 percent increase in health insurance rates