Sean C. Morgan
Sweet Home’s city manager is proposing an 18.8-percent increase in spending, mostly composed of some $6.5 million in capital projects, in the city’s proposed 2019-20 budget.
City Manager Ray Towry presented the $23.9 million budget and delivered the annual budget message to the city’s Budget Committee Thursday evening, April 4, in the Sweet Home Police Department training room.
Spending is increasing over the next fiscal year, which begins July 1, “as the city narrows in on some major projects,” Towry said. “For the 2020 budget development process, staff was asked to put together a Capital Improvement Plan that would address needs for the next five years.”
The list for 2019-20 includes equipment, street maintenance, facility upgrades and general improvements to city parks and infrastructure, he said. “At a time when many government organizations are cutting back, this budget commits Sweet Home to finish what we started. This budget provides the necessary funding to enhance the livability of the community and meet the goals established by the council.”
The largest project adds $3.6 million for the rehabilitation and expansion of the Wastewater Treatment Plant, Towry said. The city is entering the final design phase of the project, which will further refine the estimated cost, which stands at $28.1 million at this point, down from early estimates of more than $40 million.
Other capital projects include an upgrade to police dispatch equipment, an evaluation of capacity upgrades to the city’s water system, continued improvements in Sankey Park, analyzing the future of the library building and overlaying and repairing 29th Avenue, Juniper Street, 32nd Court, 45th Avenue and 46th Avenue.
“The projects are audacious,” Towry said. “With a small staff, this list might seem daunting to some. However, city staff are eager to work and are looking forward to moving forward into the future.”
The 2018-19 budget, including transfers among funds, contingencies and ending fund balances, was $26.6 million, Towry said. Excluding transfers, contingencies and ending fund balance, the city budgeted spending at $14.4 million. For 2019-20, the city proposes increasing spending to $17.1 million.
“For at least one of our funds (the General Fund), resources are limited, thereby requiring difficult choices that will shape our community in the future,” Towry said. “Sweet Home’s budget for the 2020 fiscal year is not filled with cut proposals like many other communities and instead focuses on additional growth and stability.”
The budget projects a 5-percent increase in police and library levy revenues as property tax compression decreases, the result of increasing real market property valuation.
In its utilities, the budget proposes an increase in the storm water utility from $1 per equivalent dwelling unit – single family residential units – to $3. It proposes no increase in wastewater rates while proposing an increase in water rates.
Towry said that the increase will amount to less than $4 per month for the average city utility customer.
Growth in property tax revenue for the General Fund is projected at a maximum of 3 percent based on limits on the growth of assessed property values, Towry said. “While any increase is beneficial, the General Fund is facing limited and diminishing resources,”
The budget projects $3.3 million in General Fund expenditures, Towry said, while revenue is anticipated at $3.5 million.
“While the net from operations shows a surplus, the increased expenditures are outpacing the revenue generation,” Towry said. From 2015-16 to 2016-17, revenues increased by 10.1 percent, while expenses increased by 22.4 percent.
Based on the trend, Towry said, the fund’s five-year forecast shows a deficit fund balance in 2021-22, Towry said. To mitigate the problem, city staff is proposing what “is considered to be a best practice” recommended by the Government Finance Officers Association, to create a internal service fund that would contain the city’s central services, the city manager’s office, the Finance Department and city attorney services.
The idea isn’t new to Sweet Home, Towry said. Public Works annually transfers money to the General Fund to pay for financial services. The new fund will spread the cost out among all departments, including the library and Police Department.
Committee Chairman Dave Holley, who was elected by committee members, said that the members of the committee should understand what the impact of this decision will be.
Holley, a former mayor and councilman, said this would be his last year on the Budget Committee. The committee appointed Dave Jurney vice chairman.
Other members present Thursday were Gerritt Schaffer and Derek Dix and councilors Diane Gerson, Cortney Nash, Susan Coleman, James Goble, Mayor Greg Mahler, Dave Trask and Lisa Gourley. Committee member Kenneth Hamlin was absent.
The Budget Committee has two vacancies. For more information or to apply, stop by the city manager’s office in City Hall, 1140 12th Ave., or call (541) 367-8969.
The committee is scheduled to review the proposed budget in detail at 6 p.m. on April 25, April 29 and April 30. It will review the police, library and executive budgets on April 25 in the training room at Sweet Home Police Department, 1950 Main St.
During the budget process, the Budget Committee reviews a budget proposed by city staff. It may modify the proposed budget prior to approving it. The committee’s approved budget moves to the City Council for a public hearing and adoption by the end of the current fiscal year, 2018-19, by June 30.