City holding special meeting to discuss budget proposal
City Commissioners will meet for a special work session on June 28 to continue discussion of the city manager’s proposed budget for the upcoming fiscal year, which begins July 1.
They’ll meet at 5 p.m. in the Gibson Room at the Civic Center.
City Manager Greg Doyon and the city’s finance staff presented the proposed budget to commissioners during a June 21 work session.
The budget, proposed by City Manager Greg Doyon and staff, includes taking the full property tax increases available to the city, using a portion of the fund balance and some CARES Act funds to balance the budget.
The city didn’t raise property taxes through the inflationary factor of permissive medical levy for the last two years.
Municipal governments are limited by state law on how much they can raise taxes annually and the rate is half of the three year average of inflation. That typically doesn’t generate much in terms of new tax revenue for the city, but as the national inflation levels rise, those figures could also increase.
If the commission approves taking the full inflationary increase, that’s an $8.36 increase on a house with a $100,000 taxable value, according to the city finance office. It’s a $16.72 increase on a house with a $200,000 taxable value.
City staff are also proposing to take the full permissive medical levy, which would add $248,305 in new revenue, with an impact of $3.23 on $100,000 house and $6.47 on a $200,000 house.
For comparison, the city is projecting $22.9 million in tax revenue for the upcoming budget in the general fund, the proposed police and fire budgets are $27.4 million.
If the city takes the full inflationary factor, plus the estimated $400,000 in newly taxable property and an estimated $294,004 in the entitlement share from the state, the city is looking at about $1.3 million in additional tax revenue, according to the finance office.
Doyon is recommending using about $1.6 million in CARES Act funds and a portion of the undesignated fund balance to balance the budget.
Without using raising taxes this year, Doyon said the budget would have a $2 million shortfall.
Doyon told commissioners that if they chose that option, they could direct him to reduce the budget, or use the fund balance, which would take it down to about 15 percent. City policy is to maintain a 22 percent fund balance in the general fund, which is about a month’s worth of operating expenses in the event of emergencies, cash flow issues, or other unplanned incidents.
Doyon said in that case, he would go to the list of general fund subsidies to other city funds, such as the library, health department, animal shelter, swimming pools, recreation center, civic center events among others, and eliminate those, which total about $1.8 million in the proposed budget.
Then he’d go to the departmental above and beyond requests to make more cuts.
“I’m pretty certain you’d have to cut personnel to meet that number,” Doyon told commissioners.