City council will consider on Wednesday adopting a $167.8 million budget that includes $7.3 million for capital-improvement projects and equipment purchases — and no employee layoffs.
“The city is doing a really good job reducing operational costs while at the same time bringing in short-term revenue streams,” said David Bozanich, city finance director.
Those short-term revenue streams include $2.9 million from V&M Star lease revenue and an expected $1 million in state casino tax funds this year, he said.
The city also reduced employee costs by about $2.5 million to $3 million this year through an early-retirement buyout, he said.
“We’ve allocated more to capital improvements this year than in at least the past 25 years,” Bozanich said. The short-term revenue “will have a profound impact on the city’s ability to provide improved and additional services.”
The V&M lease will provide the city with $2.9 million annually for this year, 2014 and 2015.
“We’re investing our one-time money into one-time capital expenditures,” Bozanich said. “We’re trying to avoid a critical mistake of funding long-term expenditures, like salaries, with short-term funds. A critical mistake would result in layoffs and reductions in services to the public.”
Council is meeting Monday to review the budget with administration officials, and plans to vote Wednesday on the spending plan.
The city usually budgets more than it spends.
For example, council approved a $41.2 million general fund last year, but the city spent $39.1 million.
Also, council approved an $18.6 million budget last year for the police department, but the department spent $18.2 million, largely through the reduction of overtime.
As for the reason why actual spending is less than the amounts budgeted, Bozanich said departments are doing a good job of controlling spending.
A number of departments — most notably police, fire, street, and park and recreation — will see increases over last year’s proposed and actual expenditures because they are the main recipients of the additional money for capital improvements and equipment purchases.
A key source of income to the city comes from income taxes. The city anticipates collecting $42,475,000 in income tax this year. It received $42,471,700 last year and $43,948,900 in 2011.
That money comes from a 2.75 percent tax the city imposes on those who work and/or live in the city and a 2.75 percent profit tax paid by companies.