Tuesday, June 7, 2011

Budget 2012

On June 21, the city council will vote on the budget for the fiscal year ending in 2012. Two public hearings will be conducted, the first on Tuesday, June 14, prior to the regularly scheduled city council meeting, and the second on June 21, prior to the vote. The intervening week will allow time for the council to request adjustments, if necessary, after the first hearing.

Unfortunately, I will be travelling on business the day of the hearing. I am doubly interested, therefore, in any comments you may wish to leave here at the blog or on Facebook. I will also listen to the tape of the hearing before I cast my vote.

Here's a birds-eye view of the proposed budget.

Revenues

The good news is that no property tax increase is proposed. Property tax will actually come in two-tenths of a percent lower than last year, thanks to the mysteries of Utah's Truth in Taxation law, but other revenues will offset the decrease. Overall, the general fund shows an increase of 6.9 percent, owing in part to stabilizing sales tax receipts, but mostly to increased revenue from the Fire and EMS department.

That's the good news. The bad news, from a revenue standpoint, is that growth is still slow and impact fee revenues are correspondingly weak. This threatens the pressurized irrigation bonds, which depend to a significant degree on impact fees for their repayment. I still don't know the extent of the damage, but I have thrown my support behind a water rate study that will help us find the best way to make up the difference.

It goes without saying: So long as the water bill continues high, the City must do all it can to keep other taxes low.

Expenses

The largest increases in the proposed budget are three: a new fire truck, a cost-of-living increase for employees, and the creation -- and funding -- of an Advanced Officer position in the police department.

I view these as necessary, preventive expenses. The fire truck will replace a 1978 model that OSHA cannot certify, a truck that risks break-down on every call it makes. As for the employees, the taxpayers make an investment every time the City hires and trains a specialized employee, and they take a loss every time an employee leaves to make more money in a neighboring city. Nowhere is this problem so evident as in the police department. American Fork cannot continue to absorb the financial cost of training young officers for other departments.

Road maintenance, another significant preventive expense, will be maintained at $500,000 per year, which is the level the council approved when it passed the 2008 property tax increase. American Fork's drivers need no persuasion as to the need. City streets have deteriorated due to extreme weather conditions, a high average age, and street cuts from repair and installation of sewer and water infrastructure. We cannot cut back on road maintenance without incurring higher costs in the future.

Unfunded

Many quality of life projects will go begging this year. Sidewalks will limp along at the rate of $110,000 per year, enough to do full frontage at four or five houses. Library collections (books, primarily) will still receive half the funding accorded the same in Pleasant Grove and Lehi. Cemetery expansion, parking at the fitness center, public restrooms at the parks -- still pipe dreams.

Sadly, these projects must take a back seat to financial realities. The City must be sensitive to the economic hardships of its residents. Unemployment is still at 7.5 percent, even in Utah. Gas is $3.50 per gallon, milk $2.33, and water bills have exceeded $100 per month.

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In all, I feel the proposed budget is frugal and balanced, with preventive expenses receiving priority and luxuries taking a back seat. It's a prudent approach and I'm prepared to endorse it, but I'm interested in your thoughts. Please log in and tell me what you think.

3 Comments:

Blogger The Scherbel Family said...

I agree. I think this budget is as good as it could be for this year.

June 7, 2011 at 5:13 PM  
Blogger Wendy said...

Overall it seems good. I am concerned, of course, about using road repair budget to put in the road base at 1120 North. I'd rather wait until we can fully fund a 50 foot culvert.

June 7, 2011 at 5:36 PM  
Blogger Heidi Rodeback said...

Wendy, thanks for raising the issue of 1120 North. It is true that road repair funds were considered for the road base at 1120 North, but where you use the polite word, "concern," my fellow council members used stronger words like "violently opposed" and "refuse to allow." Impact fees will be used instead. The other point you raise is equally valid. No money should be spent until there is consensus on the final design.

June 7, 2011 at 11:16 PM  

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