The Clinton City Council has formally adopted the city’s 2013-14 budget, slimmed down by $1 million from the 2012-13 fiscal plan, and including no tax increase, slight hikes to water and sewer rates and solid waste fees and the funding of a financial software upgrade and a half-million dollar renovation and expansion of the Public Works facilities.
The plan dips into reserves, taking $130,000 in fund balance and $350,000 in retained earnings, to balance the budget, however staff said the money is not for operations but for one-time capital expenses that lay the groundwork for growth in the coming years.
The approval of the plan Tuesday came in a matter of moments, with the plan having been discussed during two workshops in recent weeks. The budget was presented earlier this month, prior to a public hearing during which no one spoke. There was limited discussion at Tuesday’s special session.
“You received the final document last week,” said interim city manager Shawn Purvis. “This is everything we’ve talked about through workshops and presentations and everything else, and you’ve seen the numbers. This is for your formal adoption to start July 1.”
The approved 2013-14 budget for the City of Clinton totals $14,151,900 for all city operations, capital improvements and debt service requirements, down about 7 percent — $1,071,585 — from the 2012-13 amended budget.
“Based on the circumstances we find ourselves in, it’s a very responsible budget,” said Mayor Lew Starling.
The 2013-14 General Fund totals about $8.8 million, or 12.6 percent less than the amended 2012-13 budget of approximately $10 million. The 2013-14 Water and Sewer Fund totals about $5.2 million, or 4 percent more than the amended 2012-13 budget of approximately $5 million.
The property tax rate of $0.40 per $100 valuation will stay the same. The rate will provide approximately $2.7 million in property tax revenues based on an expected collection rate of 97.5 percent.
An increase in solid waste fees, from $14.50 to $15 per month, will help offset fuel and maintenance costs and equate to roughly $6 more a year for each household, Purvis noted.
Where sales tax revenues are expected to go up slightly, revenue is being lost in the area of privilege licenses fees, which will be reduced by about $70,000 in 2013-14 due to the closing of the video sweepstakes establishments. The city will also receive about $70,000 less in Hold Harmless funds, state monies that make up the difference between sales tax and local government reimbursements.
“That’s almost $145,000 that we did not get this year,” said Purvis, “and we had to adjust for that.”
In the Water and Sewer Fund, rates will increase by 1.6 percent to keep up with inflation and ensure adequate funding for future capital improvement projects.
For 2013-14, water base rates would rise from $12 to $12.19 and sewer base rates from $12.50 to $12.70. The water consumption rates would increase from $1.60 to $1.63 per $100 cubic feet and the sewer consumption rate would increase from $1.75 to $1.78 per $100 cubic feet.
The budget also raises grave plot fees for both city cemeteries from $300 to $450 for residents and from $600 to $900 for non-residents.
A water production position is being added in 2013-14 in preparation for a $5 million water plant expansion project, one of many projects set to begin in the next year and receive funding in the coming budgets. However, other positions will wait.
Positions not included in 2013-14, but needed in the coming years, are a utilities engineer, police detective and water resources lab technician, staff said. A two-month hiring freeze on any vacated position, allowing staff to evaluate the need for it, will continue in 2013-14.
Among the major expenses for 2013-14, $500,000 will be to expand and renovate the Public Works facility, built 40 years ago. Additional storage space is needed to ensure a safe and clean environment for employees, and an improved reception area is expected to be provided as a result of the project.
The 2013-14 budget also allocates $142,000 for a financial software upgrade. The city’s current financial software “is very limited and quickly becoming obsolete,” with an upgrade expected to improve staff’s ability to keep adequate financial records and meet current financial reporting standards.
A new Performance Appraisal System, which began in the current budget, will be fully implemented on Jan. 1, 2014 and allow high performing employees to receive up to a 2.5 percent performance increase. The total cost of implementing the program is $30,000 in the General Fund and $7,000 in the Water and Sewer Fund.
Among other notable expenses proposed in the budget, the city has included $200,000 for street resurfacing and $50,000 for engineering services associated with the proposed Chemtex facility. Vehicle expenses would include three police patrol cars with cameras; one sedan for recreation; a one-ton truck for streets; one small SUV for the Public Works and Utilities director; and one lawnmower for grounds.
The utilization of $130,000 in fund balance and $350,000 in retained earnings allow the budget to be balanced, while also providing for one-time capital expenses, notably in the Water and Sewer Fund. Those funds still remain above city-adopted thresholds, Purvis said.
The city’s estimated undesignated fund balance on June 30, 2013 is $3.6 million, or roughly 42 percent of expenditures, above the city-adopted goal of 38 percent. The city’s retained earnings stand at $3.3 million, or 70.5 percent of expenditures, above the city-adopted goal of 50 percent.
Starling said the budget was sound under the circumstances, and allowed the city to continue toward its goals of growth and sustainability.
“We want to thank the staff for working very diligently on this budget. All budgets are a challenge, and this is no exception,” the mayor said. “I think it’s a very responsible budget under the circumstances. We tried to provide for capital needs, we maintained the same tax rate and we also tried to provide for our wonderful employees. I think this accomplishes all of that.”
Chris Berendt can be reached at 910-592-8137 ext. 121 or via email at email@example.com.