Archive for Tuesday, July 28, 2015

Council approves 2015, 2016 budgets

July 28, 2015

The city of Shawnee is looking at finishing out 2015 and starting 2016 with a growing tax base that is recovering from the national recession, with debt levels in the city decreasing and a reserve fund above expectations.

The strong financial condition in the city, said Finance Director Maureen Rogers, is why the city has budgeted for more spending in the upcoming year and is returning to pre-recession expenditures.

The city council, with some opposition, voted to approve the 2015 revised budget with a 6-2 vote and the 2016 budget with a 5-3 vote. Council members Eric Jenkins and Dan Pflumm voted against the 2015 revised budget. Jenkins, Pflumm and Mike Kemmling voted against the 2016 budget. The opposition said that they could not vote for such an increase in spending within the city.

The council approved an additional $3.4 million in expenditures for the Special Highway Fund and $2.2 million for the Stormwater Fund in 2015 due to increased funding levels from the Parks, Pipes and Pavement taxes.

For 2016, the total city budget topped $101.4 million, up from about $89 million in 2015, with a property tax levy of $18,841,561. The mill levy of 24.520 will remain the same as last year.

Rodgers explained at a public hearing Monday night that the city’s total assessed valuation has reached levels higher than before the recession. That means the city is strengthening its tax base and has created a budget for 2016 with revenues levied from property taxes rising to $18,841,561 from $17,615,846 last year. The rise doesn’t represent an increased tax rate, but additional revenue from the rising assessed value of property in Shawnee.

With the strengthening of the city budget, city staff says the 2016 budget will provide an adequate dedicated funding stream for equipment replacement, facility maintenance and major technology replacement. It will position the city to save significant financing costs through future cash funding of fire trucks. It relieves pressure on the Stormwater Fund by increasing transfers from the General Fund to that fund. It restores several positions that had been eliminated during the recession, including a new police officer and facility technician in 2015 and a street inspector, fire inspector and maintenance worker in 2016.

Pflumm opposed several aspects of the budget, including the new staff hires. He said the increase in the city’s budget “meets some needs but includes a lot of wants.” He said he preferred to see the city put more into the reserve fund.

The city’s reserve fund has reached more than 50 percent in the last two years, well above the city’s policy requirement for maintaining a 30 percent reserve. The 2016 budget allows for $3.6 million in expenditures from that fund down to a level of 36 percent. Rogers explained that the budgeted reserve amount is created conservatively and the city has historically come back with a much higher reserve level than what was budgeted. In 2013, the city budgeted for a 40 percent reserve fund and ended the year with 49 percent. In 2014, the city budgeted for 40 percent again and ended with 51 percent. Pflumm argued the city would be deficit spending.

“Just because it's on paper here doesn’t mean it’s a guarantee at all,” Pflumm said.

Council member Stephanie Meyer countered saying that it would be wrong for the council to continue to build up a large reserve fund instead of spend it to better the lives of Shawnee residents.

“If we’re hoarding 50 percent reserves, than that tells me we’re taxing too much and we should return some money to the citizens,” Meyer said.

Meyer voiced her approval of the budget, saying that the increased spending is needed to continue to grow the city.

After the budgets were approved, Jenkins said he thought the city’s budget process is flawed and that his proposals for cost saving and using more of the general fund for roads were not adequately considered.

“There were no compromises,” Jenkins said. “Those who presented ideas were accused of micromanaging or were marginalized.”

He added that the final budget numbers were not agreed on in “good faith” and that the budget process does not work for the citizens of Shawnee. He said that the city has a problem when the city spends just $415,000 of its $47 million general fund on roads.

Jenkins' statement was met with several rebuttals from Council members Jeff Vaught, Brandon Kenig, Mickey Sandifer and Meyer. Kenig pointed out that Jenkins’ proposals, including imposing a moratorium on new hires and transfering $1 million to road maintenance from the general fund, were considered, and the council voted against them during a committee meeting. Meyer echoed Kenig’s thoughts and said that Jenkins’ suggestions were also too broad for the council to put any sort of plan of action into place. Vaught said the city and the residents had voted to fund roads through the special sales tax rather than through the general fund and cited city staff in saying that roads will be funded at a rate higher than any other time in Shawnee history in 2016 thanks to the sales taxes. The city’s Street Maintenance Program will spend $9.3 million, a 48% increase over 2015. That, Vaught said, while the city maintains staffing levels much lower than peer cities like Lenexa.

“I look at where we are at financially and I think we are in great shape,” Vaught said. “I think it’s amazing what we accomplish in the city with what we have.”


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