“For me, it just comes down to ‘Mr. and Ms. Calhoun have already tightened their belts.' I just can’t make them tighten their belts any more.”
– Council member Matt Barton
on his dissenting budget vote
Calhoun’s 2010-2011 general fund and utilities budgets squeaked by on a 3-2 vote from the city council Monday night.
Council members David Hammond and Matt Barton said the possibility of a tax increase led them to vote against the budget.
A tax increase will depend on where the city sets its millage rate later in the year; City Administrator Eddie Peterson said previously that the city may raise the rate to 1.69 mils in order to bring in the same amount of property taxes as last year.
Industrial values are down, he said, so residential taxpayers may have to pick up the difference in tax revenue.
This calculation, he said, is based on a $753 million digest, but the digest number could fluctuate as outstanding property tax appeal cases are resolved.
“For me, it just comes down to ‘Mr. and Ms. Calhoun have already tightened their belts,’” said Barton. “I just can’t make them tighten their belts any more.”
Although a tax increase may be necessary, Hammond said, he would prefer to “look for additional cuts (within city government) rather than just pass a tax increase on to the consumer.”
The general rise in last year’s property tax assessments brought about a situation that is “not applicable to what’s going on in the streets in our neighborhoods,” he said, making the possibility of a tax increase difficult to agree to.
Although this budget has come together with “a tremendous amount of hard work … with some extreme cuts put in place,” the reductions were not enough to convince him to cast a positive vote, he said. Hammond said he would have liked to see more management-level cuts, and he said he lobbied for furlough days for personnel, as well as the mayor and council.
Although the digest could indicate a tax increase, there is a chance it won’t, Mayor Jimmy Palmer said.
“I’ve been told the numbers will be more timely this year,” he said, pointing out that digest numbers changed several times last year while the city tried to calculate a millage rate.
“It has been very, very hard … hopefully there will be no tax increase,” he said.
Though the council voted in one motion on general fund, utilities and school system budgets, Hammond specified in a telephone call later that he is “100 percent in support of the city school budget.”
“Matt Barton (who was out of town at the time of the call) expresses the same sentiment,” he said.
Utilities
The revised city utilities budget is up about $2.6 million from May projections, with $50,604,668 in projected revenues and $50,622,756 in expenditures.
The $18,088 difference will be funded with money from 2005 SPLOST funds, said Utilities General Manager Kelly Cornwell.
The utilities budget originally had about $14,000 in surplus; however, that money was eaten up by $32,000 being used to pay closing fees for a loan with forgiveness caveats that Cornwell said will ultimately save the city about $480,000 on the Brittany Drive water treatment plant project.
The city had originally planned to budget the project in two phases over the next two fiscal years: $600,000 for a wet well this year and $1 million for filtration next year.
However, by applying for a loan for the entire $1.6 million this year, Cornwell said, the city is eligible to receive forgiveness on 30 percent of the total cost.
Using the GEFA loan, he said, would free up 2005 SPLOST funds the city originally planned to put toward the Brittany Springs project. Cornwell said the SPLOST money would likely be used to offset the cost of upgrading the city’s sewer treatment plant to meet state phosphorous removal standards that have not yet been set.
The city council opted Monday to move forward with the GEFA loan.
Other changes to the utilities budget include: an increase of $2,635 in the amount due to the general fund for charges resulting from an increase in health insurance and sick leave; a net savings of $22,856 from cancellation of the department’s contract with Pitney-Bowes for a machine that performs billing processes (these processes will now be outsourced); and a reduction in telecommunications revenue for $10,169 in savings due to disconnected phones and Internet.
General fund
This fiscal year’s revised budget shows an approximate $2.3 million drop from $14.4 million in 2008.
In revenues, LOST (Local Option Sales Tax) numbers are “an estimated guess at best,” City Administrator Eddie Peterson said. These funds make up the second largest revenue portion - about 17 percent - coming in at $2.1 million.
“We all know the retail economy took a nosedive in 2008 and remained flat in 2009,” he said.
In determining a LOST projection, city finance personnel looked at areas like gasoline, he said, which has fallen from $3.50 to around $2.50 since this time two years ago.
Projections are on a slight rise, however; LOST 2011 revenue projections came in at $2.1 million, up from $2 million projected for 2010.
Rents and royalties, which make up the largest portion – 23 percent – of the city’s projected revenues this year at almost $2.9 million for 2011, up from about $2.5 million in projected collections for 2010.
In a flat economy, this money was helpful in balancing the budget, Peterson said.
These funds, “you might say saved the general fund budget this particular year,” he added.
The largest share of major expenditures, categorized by department, for 2010-2011 go toward public safety and services.
“Calhoun is in the public safety and public service business,” Peterson explained.
Funding for the city police department is estimated at about $3.7 million, making up 31 percent of the general fund departmental expenditures.
Fire department funding comes to nearly $3 million, or 24 percent of departmental expenditures, while public works expenses come in at just more than $2 million, or 17 percent.
When categorizing expenditures by type, wages make up the lion’s share of the budget, coming in at 50 percent, or approximately $6 million.
Group insurance is another major expenditure; the city began planning for total increases of around 17 percent at the beginning of budget season, due in part to a high claims year. Group insurance makes up about $1.1 million of the general fund expenditures; another $959,683 will go toward other employee benefits.
After much deliberation, the council also opted to restructure the sick leave setup, putting all future employees on a program based on eight-hour days.
This change will result in “more of a level playing field for everyone,” Peterson said, but employees who work 24-hour and 12-hour days will not lose out on salary.
Council members had debated several times this budget season whether to eliminate sick leave payouts at the end of the calendar year; the payouts will remain part of this budget, however.
Major debt includes: the city golf course (principal - $270,900; interest - $98,565); school system debt (principal - $575,000; interest - $503982); fire capital leases (principal - $150,602; interest - $25,310); and a police capital lease (principal - $149,740; interest - $4,322).
Maybe some local politicians should take a look at the article on honesty in politics. It is time for citizens to get smarter about who they elect at every level.
Oh, wait a sec.
Mr. Hammond's too slick for my vote a second time.
Hope the new councilman plans to start making up his own mind.
Is it just me or isn't it sort of interesting how those few "support this particular councilman", "down the city departments" comments come in within minutes of each other and its always the same posters??? Are we that gullible?
The well run progressive city departments who are bringing in millions yearly to the city should not have their budgets blocked, key employees lost, and morale lowered all because of this guy's personal political agenda. He wants all to know that he does support the city school budget; otherwise, he would loose too many potential city voters. Wonder if he would be so quick to cut jobs, take furlough days...from his day job?
It's easy to compare salary to salary. Equally true that local public employees/servants make more than the Georgia Governor.
Go back to your Ben & Jerry's.
Of course, your taxes are going up.
Nothing succeeds like excess.
Reminder: (Incumbent) will not get my vote.
Shaw and other companies allowed to skip out on their fair share of taxes. True or False ?
2 councilmen got it right. True of False ?
Golf is expensive.
Does this statement surprise anyone??????????