City budget shows slightly improved economy
Carson City took a conservative approach to its budgeting process this year and adopted a final budget that didn’t involve cuts in programs or people.
“The economy has been bad the last three years, and we’ve been living off of our ending fund balance the last couple of years because the board (of supervisors) didn’t want to raise fees,” said Carson City Finance Director Nick Providenti. “They wanted to see if the economy would get better.”
Past years have also involved using about $3.7 million from a stabilization fund and some money from a couple of insurance funds that had extra in them.
“We’ve just been trying to bridge the gap the last couple of years,” he said.
Last year took the biggest bite out of the budget with the city adopting a hit list of 142 items including personnel that needed to be cut to help balance revenues versus expenditures in the 2010-11 fiscal year.
Providenti said a worst-case scenario that year would have involved all 142 items, but the school district stepped up and gave about $500,000 back to the city, saving many jobs and programs.
“Everyone has just kept hoping that we’d see the economy start to stabilize,” he said.
“We’re not totally out of the woods yet. The couple million dollars in one-shot money to help us balance our revenues and expenses gap is done, and we have to make it up now,” he said.
Property tax collections generally stay about the same due to the state cap, but sales taxes have been creeping up, he said, mainly due to the two new auto dealerships, Kohl’s, Big Lots and Big 5.
Providenti said in reviewing the past few years, there have been 13 layoffs since 2008 and 68 reductions to the workforce, some through voluntary separations, but others through retirements or general attrition.
Supervisors approved the tentative 2011-12 budget last month. The only change was to the Quality of Life fund with $51,237 being removed for work done by supervisors, the clerk and the city manager on Quality of Life projects.
“The city, through conservative budgeting and fiscal practices, had accumulated resources over the last several years to help fund revenue shortfalls, primarily in consolidated taxes,” Providenti wrote in his budget report.
“The city has had a policy to retain 8.3 percent current year expenditures as an operating reserve in the general fund, but because of the current economic conditions, the board lowered the amount to 5 percent beginning in fiscal year 2011,” he said.
“Due to the economy, general government capital projects have been put on hold, as we are not appropriating any new money for capital expenditures in fiscal 2012,” Providenti said.
• General fund revenues are expected to increase 2.7 percent from estimated fiscal 2011.
• Property tax revenue is expected to increase 5.53 percent, while intergovernmental revenues go up 2.9 percent and charges for services climb 1.67 percent.
• Consolidated tax revenue is the largest single source of general fund revenue comprising 33 percent of the total estimated revenue.
• Officials project a consolidated tax revenue increase for fiscal 2011 that is $775,000 higher – or 4.4 percent – than the 2010 actual.
Other expenditure highlights of the budget include:
• Total general fund expenditures are expected to decrease 1 percent from estimated fiscal 2011.
• They are projected to be $56.1 million in fiscal 2012.
• Salaries and benefits comprise 77.9 percent of total general fund expenses.
• Services, supplies and capital make up the remaining 22.1 percent.
For the city’s enterprise funds, two rate increases, which already have been announced, will take effect this year.
• The sewer utility is including a 14-percent increase in rates effective July 1. The increase is needed to offset rising operating costs of 2 percent and to fund debt service for equipment upgrades, sewer main extension and repair, and freeway utility relocations.
• The water utility is including a rate increase of 5 percent effective July 1 to offset rising operating costs of 2 percent and to fund debt service for equipment upgrades, land acquisition and freeway utility relocations