Gov't
City of Central 2010-2011 Budget Address
I submit to you the budget for the new fiscal year, beginning July 1, 2010. I consulted with our Finance Director, Suzonne Cowart, and my Executive Assistant, David Barrow, in preparing this budget. This budget for the fiscal year 2010-2011 represents small changes from the 2009-2010 budget in most expense categories. The budget is a conservative one, and expenditures are budgeted within anticipated revenues. The amounts included within the budget are based on cash estimates. The budget documents attached include anticipated revenues and expenditures for the General Fund and three Special Revenue Funds. I will cover the major aspects of the budget in separate categories below.
GENERAL FUND HIGHLIGHTS
Revenue
Due to the current state of the national economy, we are projecting only a 1% increase in General Sales & Use Taxes. For the first ten months of the 2009-2010 fiscal year, General Sales & Use taxes grew by approximately 1.7% within the city of Central as compared to 2008-2009. We chose a conservative growth estimate of 1%. Auto Sales Taxes were up slightly this past year, part of which was due to the “Cash for Clunkers” program last summer. However, we are not projecting any growth in this category as vehicle sales have been fluctuating the past few months. An internal audit for the calendar years 2006 and 2007 conducted by the City-Parish resulted in over $60,000 in additional motor vehicle sales tax revenues to the City of Central which was recorded this year.
Occupational license revenues for businesses decreased by a small amount last year, and we budgeted a slightly lower amount for the upcoming year. We will continue to pursue those business owners who do not pay their annual license fee as part of our Administrative Hearing Court.
As part of our contract with CH2MHILL, residential and commercial permitting fees are collected and deposited into our city account, and in return, CH2MHILL is reimbursed 90% of these fees as their payment for operating our permitting and inspection division in conjunction with Safebuilt. With the completion of several new subdivisions in Central this past year, the growing commercial building projects, and the large number of residential lots on the market, we are projecting building permit fees to grow for the next fiscal year. Please keep in mind that there will always be uncertainty in projecting the actual amount that will be collected, but we feel that new construction will keep this category on the rise.
We will continue to pursue grants to help fund projects and purchases of equipment for our city. We have received our annual Louisiana Governmental Assistance Program (LGAP) funds for traffic counting and sign equipment for the city and equipment for Central Fire Department this upcoming fiscal year, thanks to our state legislative members and Governor Jindal. The Central Fire Department is always a shared recipient of this state funding. Also included are grants to fund the Hooper Rd extension study; Curve Safety improvements on Devall, Denham, Lovett, and Frenchtown Roads; Traffic Calming on Durmast Drive; and additional funding to design a new administrative building and City Hall. Additionally, our Public Works Director, Roy Hutchinson, has secured state funding for drainage improvements to sections of Beaver Bayou, and Police Chief Browning is anticipating a grant for police equipment. Total of all anticipated grants is near $344,000.
Zoning and Subdivision fees are retained 100% by the city of Central as part of our contract with CH2MHILL. We budgeted a higher amount than last fiscal year, although these fees are also difficult to project an exact amount. This larger amount is due to the fact that construction of single family homes is on the rise in Central, and we see this as a continuing trend with several new projects on the horizon.
We are investing some of our money with LAMPS to possibly provide a better interest rate of return on our money. We are also looking at changing our fiscal agent bank in order to provide a better rate of return on our investments.
Total anticipated revenues from all sources is approximately $6,234,000.
Appropriations
The Legislative expenses are projected to remain close to the same this upcoming year. We have discovered that the city does not have to pay federal and state unemployment taxes on the council payroll. This will result in a savings, and we have requested a refund from the IRS for the past three years.
New expenses for the new Administrative Hearing and Mayor’s Court are included in the budget. This number may need to be revised based upon the number of cases that appear before the court.
The Executive expenses will increase by 1.3% due to a small cost-of-living raise for the mayor’s Executive Assistant and Administrative Assistant, an increase in required retirement contributions to the Municipal Employees Retirement System, and a dues contribution to the Capital Region Delegation. Payroll taxes will be reduced due to the fact that city no longer has to pay its contribution of federal and state unemployment taxes.
Financial Administration is expected to stay the same. Accounting, payroll, and legal fees are all budgeted the same as last year. Our legal fees are subject to change depending upon unanticipated legal matters that may arise during year.
City Operations and Services costs will decrease by over $150,000 due to our new contract price with CH2MHILL. The contract is budgeted at $3,561,700 for the next fiscal year. We also budgeted 90% of the expected building permit fee revenue as an expense as part of our contract with CH2MHILL to operate our permitting and inspection division. There is pending legislation before our city council to reduce some of these fees. If this legislation is passed, adjustments to the budget will be made accordingly.
Planning and Zoning expenses are expected to remain the same. The remaining phase of our Master Plan Land Use Plan by the Moore Planning Group is scheduled for completion, as we will seek their advice as well on extra requests for planning the growth of city arises. Our zoning attorney, Mark Balkin, will update our new zoning code to present to the Zoning Commission and City Council for approval as well. We have applied for a grant through the Louisiana Recovery Authority to help fund our Master Plan and zoning attorney fees. These grants will be awarded by the end of June.
General Administration is budgeted to decrease by nearly $30,000. The largest amount of this decrease is due to anticipated decreases in our general liability and insurance policy. We have recently leased space in Suite 7 next to our current offices for a new office and evidence room for the Police Chief and Administrative Hearing Court. Increases in rent and utilities have been added to the budget for this expansion at a cost of approximately $10,400 annually.
Included in the budget is a Public Safety request to improve fire hydrants and water flow in certain areas of the northern part of the city where fire hydrants are severing lacking. $2,000 has been placed in the budget to help fund these improvements.
The Police Department budget was submitted to me by Chief Browning and represents a 10% increase over this past year’s projected budget. Chief Browning has requested a small increase in insurance coverage for his reserve officers as well as increases for equipment purchases, some of which will be purchased through a reimbursable grant.
In the Sanitation division, $60,000 has been appropriated for weed-spraying of certain ditches within the city. This amount is based upon the contract that the City-Parish awarded in May 2009 to Louisiana Vegetation, Inc. The City-Parish has allowed us to piggyback on their contract amount for a period of three years.
Economic Development has become a priority within our city. We continue to budget $10,000 for publicity for our city in order to attract new businesses and jobs, as well as $50,000 to be used to hire an economic development coordinator to assist us on a monthly basis with economic development in our city as well as additional economic development tools for enticing new businesses to locate in Central. There is currently a state appropriation in House Bill 2 in the amount of $50,000 to help cover these costs.
Several Intergovernmental Expenditures with other agencies are included within the budget. This includes sales tax collection fees for the City-Parish Finance Department, East Baton Rouge Animal Control Center contracted services, and Extra Duty Deputies labor from the EBR Sheriff’s Department. I have met with Sheriff Sid Gautreaux several times recently, and I am recommending an increase to $100,000 per year for the Sheriff’s Office to provide additional deputies to patrol our streets through the Central Substation.
This budget also reflects other expenditures of Furniture, Fixtures, and Equipment of the grant purchases referred to above, as well as general equipment purchases that may be needed for the city and renovations to the newly acquired Suite 7.
SPECIAL REVENUE FUND HIGHLIGHTS
Roadway Tax (Half Cent Sales Tax)
As of June 30, 2010, we anticipate the Parish of East Baton Rouge will have collected close to $4.2 million in this fund. We are budgeting an additional $930,000 to be collected in the 2010-2011 fiscal year.
Of this amount, 70% is dedicated to the Hooper Rd/Sullivan Rd Green Light Plan widening project. This is an agreed-upon shared effort between the city of Central, DOTD, and the Parish of East Baton Rouge. 27% of these funds are dedicated to street rehab and overlay, and 3% to sidewalks and beautification, according to a parish wide vote.
On June 8, 2010, the city Council authorized advertisement for bids to rehabilitate approx. 4.5 miles of roads within the city at an estimated cost of $1.2 million. This project will be funded through the roadway tax, franchise fees, and budget surplus if necessary.
Traffic Contributions
The City receives these funds from local subdivision developers to assist with traffic related matters impacted by their developments as they arise. Because of several new residential developments in the works, we are anticipating contributions in the amount of $33,000 for this new fiscal year.
Franchise Tax
The City now collects franchise fees from Cox Communications, Entergy, and Demco. Based upon projected revenues provided by each of these entities, it is anticipated that we will receive $300,000 from Cox Communications, $400,000 from Entergy, and $600,000 from Demco annually. The City Council passed a resolution in May 2009 requesting that a minimum of 50% of these funds be set aside for drainage and roadway projects within our city. In the budget, we have dedicated 30% of these anticipated franchise tax funds towards drainage projects, 25% towards road improvements, 10% for bridge repairs, and 35% for emergencies that may arise during the year.
The 2010-2011 City of Central budget that I propose today continues to deliver basic city services as we continue to grow. We have attempted to present a budget that will be helpful in your formulating a financial plan for the next budget year. This budget projects a surplus of over $1.1 million, which will place the city in a very comfortable position in having excess funds available for public works and capital improvement projects as well as for unanticipated emergencies and expenditures. I have prepared this presentation to the best of my ability and knowledge of the financial circumstances the city enjoys at this time.
Thank you,
Shelton S. “Mac” Watts
Mayor of the City of Central
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