The Jefferson city council on Tuesday amended the budget for the fiscal year ending June 30, showing an increase in revenues of $751,000 and an increase in expenditures of $2,470,000.
The ending fund balance in the amended fund balance is $3,861,332, compared to $6,331,149 in the budget pre-amendment. That’s a 39 percent decrease.
“We’ve had a lot of activity this year. A lot of things have carried over, and now the totals have to show that,” city administrator Mike Palmer said at the beginning of the public hearing.
City clerk Diane Kennedy used a computer slide presentation to explain a total of 14 budget lines that were changed – seven revenue lines and seven expenditure.
The greatest change in revenue was an increase of $730,434 in intergovernmental revenue sources. Of that, $561,000 is federal money coming in for land acquisition for the runway extension at the municipal airport. There’s also a $58,000 increase in road use tax and $46,196 received by the fire department as grants from Grow Greene County and the Greene County Community Foundation.
The “other city taxes” line increased by $124,000. That reflected estimating revenue from Wild Rose down to $135,000 from $150,000 because the casino wasn’t open for the entire 2015-16 fiscal year, but pegging revenue from the local option sales tax at $139,000 more than expected.
Water revenue is $150,000 less and sewer revenue is $57,000 less than what was in the original budget. City council members couldn’t recall how the estimate was arrived at in formulating the original budget and there was no clear reason for the decrease in revenue.
The greatest change in the expenditures was a $1.1 million increase in the debt service line. Kennedy explained that is a payment to the Iowa Department of Transportation for the Highway 4/Elm St overpass. That project was completed in the fall of 2012 but the DOT had not billed the city until this year. Bonds had been sold for the project, but Kennedy cautioned the city council that another bond issue may be needed to finish paying debt.
There is an increase of $752,000 in the capital projects line – the same airport expansion project that led to the increase in revenue accounts for a matching increase in expenditure.
Much of the expenditure increase that is not matched by an increase in revenue is in the “community/economic development” line. There an increase of $882,600 includes $682,000 in infrastructure improvements for Wild Rose Casino, Cobblestone Hotel, and Hy-Vee. The cost of those projects will eventually come back to the city through tax increment financing, but for now, it’s money spent.
Another $110,000 in the “community/economic development” line shows money put into three downtown buildings the city now owns – 205 N. Wilson, 111 E. Lincoln Way, and 200 E. State St.
The city council discussed briefly issuing bonds to replenish the city’s fund balance.
To see the notice of the budget amendment, click here.
