Missoula Chief Administrative Officer Provides Accurate Numbers On City Budget
In an earlier story, KGVO used inaccurate numbers when reporting the projected increase in the city's 2018 budget, incorrectly stating the increase at 18 percent, when the actual increase was only 3.87 percent.
Chief Administrative Officer Dale Bickell said the error was due to numbers in a spreadsheet that displayed what the increase WOULD have been if all revenue requests were funded.
"There was a column on our tax scenario spreadsheet that showed the cumulative effect of what would happen if all those revenue requests were funded, but the mayor did not present that scenario in his budget," Bickell said. "The budget process kicked off last Wednesday when the mayor presented his administrative budget to the council. Over the next several weeks the council will be getting additional presentations and deliberating until the final budget is adopted, we hope sometime in July."
So, what are the REAL numbers in dealing with a projected tax increase?
Right now, the mayor's budget has presented a 3.87 percent increase," he said. "The two largest items that require the increase are in personnel and payroll for about $315,000, and we are also increasing our insurance premiums on our self-insured health plan, and that will be approximately $327,000."
Bickell said some of the proposed increase will be in Development Services.
"With all the growth happening in the city, we're really focusing on increasing our Development Services," he said. "Because of the level of permitting, we're starting to fall behind in our permitting. We really work hard to get permits through our system quickly and we're starting to fall behind a little bit. So, we're adding three positions in Development Services."
Following, find the letter that Mayor Engen sent to the city council:
June 14, 2017
This letter conveys the executive budget of the City of Missoula for Fiscal Year 2018 for your review, amendment and approval. As I wrote to you in March, our budget is intended to reflect community goals as articulated in our strategic plan and to acknowledge the interests of the citizens we serve, some of whom we hear from on a regular basis and some of whose voices are rarely heard.
A reminder of our mission: Reflecting the needs and values of our citizens, the City of Missoula commits to enhancing opportunity and quality of life through effective delivery of city services and fiscal stewardship, while maintaining and creating a harmonious natural and built environment. And a reminder of our vision: We are an inclusive city where all people can live and celebrate meaningful, purposeful and fulfilling lives through the confluence of unparalleled recreational, cultural and entrepreneurial opportunity.
The FY 2018 budget is designed to meet our goals within our means, which, again this year, are constrained by our system of taxation, a system that leans heavily on property-tax revenues. And while our tax base is growing, until we have a firm accounting of that growth, we've elected to be conservative in our approach to this budget, funding our existing obligations and only increasing expenditures based on existing contractual obligations, inflation and community needs I believe are necessary to continue to deliver the service citizens expect.
The first goal enumerated in our strategic plan is organizational excellence, and this budget continues the work we've done in various departments to ensure we're investing in people, programs, tools and structures that make us more effective. This budget calls for two additional community-service specialists in the police department, additional support for crime-victim services and appropriate compensation for quality employees.
Our second goal is to enhance economic growth and sustainability, and this budget includes investments in Development Services and transit.
Our third goal is to invest in infrastructure and assets, which we're doing through a comprehensive street pavement evaluation, updates of court technology and additions to engineering staff, and additional maintenance funds for new facilities such as Fort Missoula Regional Park and the Art Park. In the Capital Improvement Program, we are doing important street projects such as improvements to South Avenue, Cregg Lane, and Van Buren Street. We are also renovating our newly acquired Police Evidence Facility and will create a master plan for our City space needs. Parks capital improvement projects include Syringa bike skills park, the Bitterroot Branch trail extension, and a neighborhood park at the recently acquired property on Johnson Street thanks to the Washington Companies.
The numbers: We're recommending a general fund baseline property tax revenue increase of $232,805that in part supports new budget items that are required to meet our legal and contractual obligations. We're recommending an additional $1,256,890 for enhancements to the baseline budget to move our strategic goals forward. As a percent total of City taxes, our general fund taxes will increase by 3.45%, our employee health insurance levy will increase by .51%, our road district levy will increase by .90% and our park district levy will increase by .30%. Voted general obligation bond debt will decrease by.50%.
The total increase we're recommending is 3.87%, based on a conservative growth estimate of 3.25%, modest growth in fee revenue and a reduction in fund-balance growth.
The City of Missoula receives certified tax values in August each year. If revenues increase significantly, we'll bring further recommendations to council for consideration. In all, our new requests requiring tax revenues, all of which have merit, totaled $6,140,138, which would require a tax increase of 18.48%. We believe we made difficult choices based on the information we have and chose not to put council in the untenable position of hacking away at these requests with no clear picture of actual revenues.
Accompanying this letter is a series of spreadsheets detailing new requests and funding scenarios for council and public review. As a matter of process, I'd suggest that council review funded and unfunded requests and select requests of particular interest for review with staff and the administration in budget committee. In the event that revenues exceed our expectations, council will have an opportunity to revisit all requests at its pleasure.
The good news in this preliminary budget is that it funds critical items that have been on a waiting list for several years and gets us close to our fund balance goal which, when achieved, will give the administration, council and staff greater flexibility in future years.
As we bring our water utility under municipal ownership, we can expect benefits to the entire municipal operation. Those benefits will be reflected in budgets after FY18.
We continue to seek new ways to add revenue outside of property taxes, and our efforts at the 2017 Legislature yielded some results, including an increase in gas tax that will help complete projects in our plans in public works. Next session, we will make our case again, with the help of the Montana League of Cities and Towns, to relieve local property-tax payers by seeking authority to tax visitors who use our resources without paying their fair share, much in the way Whitefish, Red Lodge and West Yellowstone do. And we will continue to balance the interests of a community that demands quality services with our collective ability to pay for those services. It's challenging work, but I believe that the thoughtful deliberation that led to this budget and your continuing deliberations, will go a long way in striking that balance.
Thank you for your consideration of this fundamental piece of civic business.