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City staff pitches $3.8M budget

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Figures show no reductions

By Jeff Bryan

Property owners hoping for a tax break this year might not see one if the council follows through with plans to adopt the tentative budget presented to them June 27 in the first of a series of workshops to discuss financial impacts for Fiscal Year 2019-2020.

Per the preliminary budget, which is set at $3,832,397 million with a millage rate of 6.5. The current fiscal year budget is $3,676,066, but projected to be $3.836 million.

However, according to a memo from City Administrator Dawn Bowne addressed to the council, she is encouraging them to set the tentative millage rate at 7 mills during its July 15 council meeting. Once set, the millage can be lowered, but it cannot be increased per state statutes.

Part of her reasoning, she wrote is because it would allow staff to “receive all data necessary to prepare a final budget projection for 2019/20 for Council’s review in August with the goal to remain at 6.5 millage rate for this fiscal year.”

“However, with no operations revenue stream identified at this time, in order to meet the unmet needs mentioned above, a review of the millage rate will be necessary,” she wrote.

Those unmet needs, which total $210,700, include:

* Fund depreciation: $12,000.

* Two police officers: $180,000.

* Salary Range Study: $5,000 (Additional amount needed for adjustments).

* Increase Code Enforcement: $6,700.

* Inventory Asset Update (state audit): $7,000.

“Council’s goal is always to avoid increasing the millage whenever possible by responsibly reducing expenses or identifying other revenue sources,” Bowne explained about holding the millage rate the same as a year ago. “Staff has presented a balanced budget at the current millage rate and identified unmet needs moving forward that do not have an identified revenue source. Council will take those items into consideration when deciding the proposed millage rate.”

In addition to the unmet needs of the city, the budget proposal calls for a 3 percent merit pay raise for city employees, totaling $21,398. According to Bowne, this is 3 percent average increase budgeted based on annual performance evaluation. The only exception to this would be the sworn officers covered by the union contract, which is subject to collective bargaining negotiations, Bowne said.

“This is to meet Council’s goal of re-establishing a merit pay plan for all employees,” she added. “This includes full-time and regular part-time employees. It does not include seasonal (mowing crew), reserve officers, temporary or beach attendants (also considered seasonal).”

Two other goals the council set for staff included:

A total restructuring of Public Works staff, which has reduced the department personnel expenses by $58,586.

“This was imperative because historically (since the reduction of gas tax reserves by Marion County), there is no longer sufficient revenue to cover the Roads and Streets operation,” Bowne wrote. “This has been discussed before City Council for quite some time acknowledging that once the ‘operational’ reserve was depleted the city’s General Fund would be forced to subsidize the Roads and Streets operations.”

This proposed budget reflects approximately $101,584 General Fund subsidy to Roads and Streets, Bowne wrote the council.

The second goal included a part-time staff assistant and an additional police officer for the police department, which has been funded in the 2019-2020 proposed budget. With an additional officer added in the current fiscal year, Bowne wrote the total number of sworn officers, including the chief, will be nine.

“Chief McQuaig has reported to council to properly and safely police the city, he is requesting a total of 10 sworn personnel,” the memo stated. “That leaves two remaining police officers to be funded.”

The current cost per officer including entry level salary, equipment and vehicle is approximately $90,000, Bowne wrote.

The budget proposed $186,700 in capital improvement projects, but didn’t list specific details. That was for planning purposes, Bowne said. The capital plan portion of the budget will be discussed at the July 24 workshop.

“Some capital items were identified in the budget and some amounts were tentative as discussed in the meeting until final quotes are received by vendors or consultants,” Bowne explained, noting those funds will come from capital gas tax reserves, 1 percent sales tax reserve, police automation reserve and established general fund capital reserves.

One source of reserve funding not included in the budget is the proceeds from the sale of the utility system.

“Those funds are being invested in a separate capital reserve account subject to council authorization prior to expending,” Bowne said. “It is not staff’s intent to spend any of those funds in this proposed budget unless otherwise directed by council.”