Everyone looks better in black, and that’s especially true when it comes to the city of Blaine’s budget.
At the February 11 city council meeting, Jeffrey Lazenby, the city’s financial director, shared the fourth quarter of 2012 financial report and noted the city’s general fund, the carryover balance from each month and year, was slightly above their estimates during the last few months of the year.
“We’re $95,000 above our target balance for the general fund,” Lazenby said, adding that the general fund is used to pay for the city’s expenditures on a month-to-month basis. “So we’re entering this year in a pretty good financial state. We’re entering a very difficult financial year on a stronger financial footing by having that extra reserve.”
Lazenby attributed that revenue bump to slight increases in business licenses, building permits and sales tax revenues, which are largely from Amazon.com and other internet purchases that are delivered within the city limits. That extra income constituted an 8 percent increase in sales tax revenue since 2011.
“We’re in a better position now to handle the situation with the resort closure because we’re not beginning the year with a dangerously low general reserve fund balance,” Lazenby said.
He recommended council set aside $20,000 of the excess funds for the remaining building improvements needed for the Banner Bank building – including the much-requested acoustics optimization in council chambers – and then put the remainder into the general reserve fund.
The general reserve fund is money that has been set aside by the city in case of an emergency. At one point, the reserve had dropped as low as $65,000, city manager Gary Tomsic said.
“We go through an analysis that looks at the potential liabilities for the city, [both financial and material], and assign a dollar value to to it,” Tomsic said. “We look at things like having to deal with a roof falling in, or a flood or a natural disaster, or even a resort closing. Then we determine what we need to cover those areas where we are at risk.”
Tomsic said that the analysis suggested that the city should have around $600,000 in the general fund reserve on hand in case of any such occurrences.
Currently, the city has $325,000 in its coffer.
“We’re trying to develop a sustainable financial picture for the city,” Tomsic said. “We have to start asking questions like: Is what we’re planning to do sustainable? Can we fund it over a period of time? It’s necessary if we want to get back to a point where we’re not cutting budgets every year.”