The city’s property tax rate and user fees may stay flat in the next fiscal year. Council members agreed unofficially at a budget workshop yesterday to increase the transfer of funds from the water fund balance to the general fund from $1.2 million under Mayor Michael Villa’s proposed budget, to $1.65 million. While the council had previously agreed to cut a $300,000 revenue line that anticipated the sale of the Chalmers property to KCG Development, the increase in the transfer, along with a consensus to increase the projected sales tax revenue line by $150,000, as well as several other minor increases to revenue projections, added up to enough to bring the property tax rate to just under four cents below the current year’s rate.
The council also agreed to increase the water fund’s contingency line by $600,000, which would erase a 17% cut in water fees proposed in Villa’s budget. Alderman Jim Martuscello suggested the move so that major purchases for the water department could be paid for out of the contingency line rather than by borrowing.
According to Martuscello, the city’s water fund balance at the end of the 2016-2017 fiscal year was $2.2 million. The high amount is partially due to transfers that were budgeted to go to the general fund, but were not recognized by the city’s auditing firm due to how the transfers were presented in budget documentation. Controller Matt Agresta has made changes in the upcoming budget documentation to avoid the problem in the future.
Increases to the sanitation and sewer user fees were also reduced to nearly the same levels as the current year by appropriating approximately $130,000 from the fund balances of each of those funds. Total user fees would be reduced by $1.77 if the council’s changes are applied.
In past years, the council has come to unofficial agreements on changes to the mayor’s budget during its committee meetings before voting on a single official resolution containing all the changes. After the official vote, the mayor has the opportunity to issue line-item vetoes which can only be overridden by the council by a 4/5 majority vote.