Fund will need boost to make payment on city’s aquatic center debt


Crestwood’s park and stormwater fund will need a boost if it’s to make a scheduled payment next year on the city’s aquatic center debt.

As forecasted in the first draft of Crest-wood’s 2010 budget, the park and stormwater fund will have insufficient revenue to make a payment of more than $1 million next April on certificates of participation, or COPs, issued in 2001 to construct the city’s aquatic center.

Therefore, city officials have recommended transferring $600,000 from capital improvement fund reserves to the park and stormwater fund to help make the debt service payment, which includes $940,000 in principal and $72,442.50 in interest for a total of $1,012,442.50.

A second interest payment of $49,882.50 on the COPs also is scheduled for October 2010.

Officials estimate the park and stormwater fund will receive $1,931,400 in revenues and spend $2,444,414 in 2010, creating a shortfall of $513,014. That would be offset by the $600,000 capital improvement reserve transfer, leaving the fund with a projected surplus of $86,986 on Dec. 31, 2010.

Further, the park and stormwater fund is projected to have a Jan. 1, 2010, cash balance of roughly $17,611 and a Jan. 1, 2011, balance of $170,954, according to the budget draft.

The fund is projected to show a temporary “deficit balance” of $62,627 in March 2010 once the city makes the COPs payment, but would be supported by the general fund during that time — which it would repay — and return to a positive balance in April, City Administrator Jim Eckrich stated in his 2010 budget message.

Meanwhile, the transfer of dollars from the capital improvement reserves will cause expenditures in that fund to exceed revenues by $508,606.

To remedy that issue, the Board of Aldermen will be asked to approve the use of additional reserves to balance the fund’s budget, according to the budget draft.

The capital improvement fund is projected to bring in revenue of $1,197,480 and spend $1,106,086 in 2010, leaving a surplus of $91,394 before the $600,000 transfer. It is slated to have a Jan. 1, 2010, cash balance of $1,632,703 and a Jan. 1, 2011, balance of $1,815,522.

Park and stormwater funds alone won’t be able to make the aquatic center payment next April due to declining sales-tax revenues and the amount of expenditures included within the fund, Eckrich stated.

While all park and recreation expenses once were paid from the general fund, financial problems led aldermen in 2003 to place all park maintenance, community center, aquatic center and Sappington House expenditures under the park and stormwater fund — a burden that eventually caused the fund to fall short of its original purpose, he wrote.

“The park and stormwater fund can no longer finance stormwater projects, any substantial capital park projects or even the annual aquatic center debt,” Eckrich stated.

In the 2009 budget, Eckrich recommended using park and stormwater reserves to balance that fund and predicted the city would have to transfer funds from other reserves in 2010 to make subsequent aquatic center debt payments.

Eckrich anticipates 2011 will bring another reserve transfer, from the general fund, to help the park and stormwater fund make the next aquatic center debt payment. However, the fund is projected to show improvement beginning in 2012 — when the city makes its final aquatic center debt payment — and is slated to be able to fund capital park projects and “begin to consider funding stormwater projects” in 2014, he added.