A public hearing on a fiscal 2006 budget that projects total revenues of $12,842,694 with total anticipated expenditures of $12,363,305 will be conducted by the Crest-wood Board of Aldermen Tuesday, Dec. 13.
The public hearing will take place during the Board of Aldermen meeting that will begin at 7 p.m. at City Hall, 1 Detjen Drive.
The first reading of ordinances adopting the fiscal 2006 general fund budget, the fiscal 2006 capital improvement budget and the fiscal 2006 parks and stormwater budget was conducted last week.
Aldermen will consider final approval of the three ordinances after the Dec. 13 public hearing.
Fiscal 2006 general fund revenues are projected at $8,584,018, while expenditures are estimated at $8,339,344 — a surplus of $244,674.
In his budget message, City Administra-tor Don Greer wrote, “As we move into a summary of the expenses projected for 2006, it is important to note that while personnel costs consume 76.17 percent of general fund expenses, no adjustment has been made for Job Value for the second consecutive year, nor is there any wage increase anticipated for those employees currently earning at or above the 95th percentile of their respective Job Value.
“Projected general fund expenses of $8,339,344 for calendar year 2006 represent an increase of $9,447— 0.0011 percent — when compared to estimated fiscal year 2005 expenditures,” Greer wrote.
For the capital improvements fund, fiscal 2006 sales-tax revenue is projected at $1,491,618 with grant receivables bringing total revenue to $1,644,995. Expenses totaling $1,414,676 are being recommended for a surplus of $230,319. The city’s street maintenance program will total $732,668 from the capital improvements fund for fiscal 2006, according to the proposed budget.
The capital improvements budget also recommends a $95,000 initial payment for a lease/purchase agreement with Motorola to replace the city’s police radio system and a $32,000 grant enabling the installation of radio repeaters at Westfield Shop-pingtown Crestwood to improve radio signal strength. No local participation costs are required for the grant, beyond paying for the system initially, Greer stated in his budget message.
For the parks and stormwater fund, revenues are projected at $2,613,681 for fiscal 2006, while expenditures totaling $2,609,285 are anticipated — a surplus of $4,396. In his budget message, Greer noted, “… (A) significant portion of the annual proceeds from this fund is used to retire the debt of the 2001 issue certificates of participation which were sold to build the Aquatic Center at Whitecliff Park. Debt service for 2006 totals $1,068,413 and represents just over 61.6 percent of the annual sales tax revenue for this fund.”
Greer’s budget message also stated, “We enter 2006 continuing to utilize a line of credit negotiated with Southwest Bank in order to meet operating expense demands. While the reductions enacted during the most recent three years have significantly reduced our operating expenses, we are sharing in the downturn in retail sales being experienced throughout the region. Sales tax receipts represent 53 percent of the city’s general fund revenues and the one-cent (sales tax) and quarter-cent (sales tax) have steadily declined by what is currently $434,446 annually or 10.47 percent during the five-year period from 2000 to 2004.”
To compensate for the downturn in sales-tax revenue, the Board of Aldermen has reduced personnel costs by more than $955,000 annually, Greer stated, reducing the number of employees to 107.25 in 2006 from 130.5 in 2003.
Greer, who has been both city administrator and police chief since December 2002, will serve only as police chief once a new city administrator is hired.
Noting that this will be the final budget he will submit as city administrator, Greer wrote, “Soon after my appointment in De-cember 2002, I learned that I had inherited a system grossly out of balance and without adequate financial history or controls. Any history that existed was a function of what I would soon learn to be a system of ‘moving’ and “offsetting” expenses in order to present a pretty picture to the board and public. As a department manager since 1990, I too believed the city to be in stable financial condition.
“It is appropriate to associate me with the pay and compensation plan, as well as the issuance of the 2002 certificates of participation. At that point in Crestwood’s history, as it continues today, the police facilities are inadequate, and in my professional opinion, unsafe. That opinion is based upon my experience and the verbose independent study completed at the re-quest of the Board of Aldermen in 2001.
“Certainly, had we known of the actual financial situation, alternatives would have been considered. In fact, those who would remember those times would reflect upon the surprise experienced by the board as they learned that the certificates were being ‘pre-sold’ as the board be-lieved they continued to have time to further discuss the issuance,” he stated.
In reviewing his previous budget messages, Greer wrote that the message re-mains the same: “(S)ignificantly increase revenues or drastically reduce operating ex-penses. The board has declined to restructure public safety — 64.91 percent of the annual operating budget — declined to seek a contract for police services or fire services. We have reduced a number of police and fire positions through attrition and have aggressively redesigned Public Works and Parks and Recreation.
“The public has rejected two proposals that would tax them specifically; in April 2005 the proposition for a general obligation bond issue was soundly defeated, and in November 2005 a modest increase in gross receipts taxes to residents also fell overwhelmingly,” he stated.
“We have reduced personnel and combined services, contracted expenses when practical and held operating expenditures to virtually no growth for three full years. The public has entrusted us with an additional fire protection sales tax to help offset the costs of fire protection services and yet I am writing to you that we are not yet where we need to be …,” Greer wrote.
Though the operating budget he is recommending is balanced for all three major funds, he wrote, “… (W)e will continue to require a line of credit to meet our cash-flow needs. In each of the past two years we have been able to reduce our need for cash-flow borrowing, but unable to meet the levels that would reduce the accumulation of debt.”