As larger cities are working to trim the fat from their operating budgets, the City of Stephenville is also working to keep it lean in the coming fiscal year.
But in Stephenville, reductions are not expected to lead to the closing of the library or the shuttering of Splashville, as administrators do not see the current need for cuts as drastic as those currently being proposed and some already realized in nearby municipalities like Fort Worth.
While the 2010-11 budget leaves little room for extras, City Administrator Mark Kaiser said in a letter to Mayor Nancy Hunter and the Stephenville City Council that it does maintain all existing programs and services. Kaiser said in looking to the new budget year, which begins October 1, there are no scheduled lay offs or furloughs.
But Kaiser also said, “Due to the uncertainty of the economy, we have not budgeted for pay raises or any capital replacements. The remaining deficit will be offset by delayed hiring, reduced training and minimal maintenance.”
According to the budget review, which was the focus of a city council work session Monday, the 2010-11 Program of Services totals $18.5 million for all funds.
Of that amount, approximately $14.8 million is for continued operations, $3.24 million for debt service and $445,500 for capital improvement projects.
In regards to property values, Kaiser said taxable property valuations have decreased by $12 million for the coming fiscal year, to $882 million.
“This $12 million or 1.31 percent decrease is comprised primarily of a reduction in commercial personal property (inventory) of approximately $25 million offset with $11.3 million from new construction,” Kaiser said. “This 1.31 percent decrease precedes increases in the previous two years of .39 percent and 9 percent, which are signs of stability for the city.”
While the city continues to see new residential construction experiencing slow, steady growth, Kaiser said commercial development has slowed.
In regards to the city’s property tax rate, Kaiser recommended an increase of $.0165, from $.4435 to $.4600 per $100 in property valuations. In making the recommendation, Kaiser said $.0585 will be applied to debt service, which compares to $.0673 in the current fiscal year.
“With the decrease in property values, the maintenance and operations portion of the tax rate will increase to $.4015 per $100 property valuation, compared to $.3762 from the 2009-2010 fiscal year,” Kaiser said. “Revenues will increase by $93,711.”
While increases in water, stormwater drainage, or landfill rates are not included in the proposed budget, Kaiser said a three percent increase to the sewer rate volume charge is being recommended “to cover increased costs.”
In highlighting the budget, Kaiser said “the reduction of budgeted investment returns and low employee turnover required the need to ‘think lean.’”
“All programs are being reduced to balance the budget,” Kaiser said.
Kaiser said the budget reflects the elimination of lobbying firm Meyers & Associates to the tune of $48,000 and deferring $20,000 in technology upgrades until 2011.
While the city will continue to work on the employee pay plan, Kaiser said no pay raises are scheduled for the coming year.
“Public safety licensed officers still receive step increases if eligible,” he said. “Employee retirement contributions and health insurance costs are up, while our workers compensation premiums are down.”
The Parks and Recreation Department (SPARD) will continue to provide an array of youth and adult services and also continue to help fund community events, according to Kaiser.
He said the proposed budget includes $34,500 for adult programs, $98,500 for youth and $38,000 for special events. And $50,000 has been budgeted for maintaining park facilities.
Looking at Splashville, Kaiser said modifications have been budgeted and following this season’s closing, the city will “continue to evaluate the efficient operations.”
But Kaiser also said the city will likely have to continue to fund operations at the aquatic center, which came with a more than $3 million price tag.
“It appears we will subsidize the program $50,000 to $75,000 annually,” he said.
And the budget “contains a pay-as-you-go approach to financing street improvement.”
“This budget includes no funds for street reconstruction, but (does include) $100,000 for street maintenance projects,” Kaiser said.
Kaiser said training funds have been reduced for the police and fire departments. For the police department, the reduction totals $250 per police officer.
In the fire department, overtime costs will be reduced by $50,000 and in both departments, step increases will be provided to qualified personnel.
“The (police) cadet program will be delayed for the coming year as a result of the lower than normal employee turnover,” Kaiser said.
“We maintain self-designated reserves for grant matching and participation agreement projects,” Kaiser said in regards to major projects slated for the city.
Some of the possible improvements that could develop during this coming fiscal year, not included in this budget are: airport hangars and runway extension, the wetland project, energy efficiency improvements, Caporal Road, the East Side Sewer Project and new water wells.
“The city is projecting it will need to subsidize the airport fund in 2011 with reserves to meet our grant matching requirements,” Kaiser said, adding that improvements at Stephenville Clark Regional Airport are expected to begin in 2011. “Major funding for these projects will come from grants from the Texas Department of Transportation.”
Kaiser said city revenue appears to be stable due to maintained property values, new residential construction and maintaining utility service demand.
“The city’s overall customer base for its water and sewer services has increased over the last five years,” he said. Since weather conditions affect water revenues significantly, revenue projections utilize conservative growth estimates to avoid budget shortfalls, and use a rolling average consumption method to factor out weather aberrations.”
In regards to retail activity within the city, Kaiser said sales appear to be down five to 10 percent but remain “within our conservative sales tax budget estimates.”
The General Fund
The general fund budget for the coming fiscal year rings in at $10,7399,773, a 1.65 percent decrease when compared to the current year. Property tax revenues are budgeted to increase $175,719 with an estimated valuation decrease of $12 million. In addition $208,825 from the Utility Fund has been allocated to reimburse the General Fund for indirect costs for water and sewer operations.
• The Utility Fund budget was decreased by 4.15 percent, or $237,522. Utility Fund reserves will be used to cover water and sewer maintenance. Rates for treated water from the Upper Leon River Municipal Water District will increase by .27 percent. Funds allocated for utility maintenance add up to $285,000.
• The proposed Landfill Fund Budget is $391,218. In addition, a transfer of $90,818 from the General Fund will help fund landfill operations.
• Airport Fund was budgeted $78,144, a decrease of $1,372 when compared to the current year. An additional $2,464 will be taken from the General Fund for operations costs.
• The Stormwater Drainage Fund has been budgeted $531,575 with a debt service payment of $562,075 and $30,000 also included in the budget.
• Special revenue funds are derived from hotel occupancy taxes(HOT), child safety fines and public safety restricted funds, according to Kaiser. HOT revenue projections add up to $280,000.
Kaiser also said the Stephenville Independent School District, Cross Timbers Family Services and STAR Council on Substance Abuse have made applications for the projected $4,500 in child safety funds, and the fire and police departments have been allocated $3,700
for training from restricted revenues.
“The staff and I look forward to implementing this budget,” Kaiser said. “We believe that this comprehensive budget for 2010-11 fulfills the objectives as directed by the city council. It emphasizes continued improvements to the delivery of services and quality of life issues of the community and works to encourage future growth of the city.”
The Stephenville City Council will hold a special council meeting Tuesday at 5:30 p.m. in the Council Chambers at City Hall, located at 298 W. Washington Street. Agenda items include a public hearing on the 2010-11 budget, which may be viewed online at www.ci.stephenville.tx.us.