Cuts needed for a healthy budget
residents were invited but none came as Blaine city council began to plow through
the citys 2002 budget this week. A Monday night budget session to review
projections for the citys general fund and get public input on city spending
was attended only by city council members and staff.
City council members will have some hard decisions to make as they rework the preliminary budget figures for the citys general expense funds. Unless some proposed departmental budgets are cut, the city will end the year with a slim $41,000 buffer. Our financial policies say we need to end the year with funds to operate for 30 days, which would be $336,000, said city finance director Meredith Riley. Its an area of real concern. Drained by big projects in recent years, the citys ending fund balance for general government has dropped from over $1 million in 1999.
Riley said she made city revenue projections based on the passage of initiative 747, which would allow the city only a one percent hike in property tax, rather than the up to six percent allowed today. Even in the city is allowed to take up to six percent hike it wouldnt close the gap in the ending fund balance - property tax only makes up 16 percent of general fund revenues. Sales tax revenues are also not likely to bail the fund out. Since 1998 our sales tax revenue has been fairly flat, Riley said. We see nothing in the future causing that to change and see some factors which could cause it to drop. Recent events make a no-growth scenario quite optimistic. Utility tax, another chunk of the city revenue pie, is expected to increase as it is based on rising power costs.
City manager Gary Tomsic said this years budget, like last years, was relatively austere. Most increases are due to cost of living wage adjustments and repairs rather than new projects and services. Roof repairs are needed over the police evidence room and the senior center, and city computer systems require extensive upgrades. The citys court is asking for additional funding to hold court an additional six hours a month to handle backlogs. Public works director Grant Stewart is also asking for an additional $100,000 to improve and maintain city streets. The city manager and legal departments expect to spend less in 2002. Were anticipating we wont see the kinds of legal costs weve seen in the past, Tomsic said.
The next step in the budget process will be for staff to scramble for places to cut. With a budget being balanced with our ending fund well be looking at finding upwards of $400,000 somewhere, Tomsic said.
Either on the revenue or the expenditure side. The revised budget will be presented to council and the public at a November 12 public hearing. .