Hutchinson City Council agreed on Tuesday evening to present a budget for 2022 that leaves the local property tax as it was in 2021.
To accomplish this, however, city workers took in more than $ 1.82 million in cuts to proposed departmental budgets, delayed equipment purchases by more than $ 864,000, and the city’s projected cash transfer took nearly $ 3 million Dollar one.
The council, which met in two evening budget meetings, also finally agreed to limit the funding for the wage increases for workers in 2022 to 2.5 percent from the original 3 percent.
A total of three new hires were approved across the city. However, department heads agreed to leave several other positions vacant that were cut or that the city was unable to fill last year in response to projected loss of revenue from COVID-19.
The council responded to a repeated request from Councilor Jade Piros de Carvahlo, which was then taken up by Councilor Sara Bagwell, not to allocate $ 20,000 in budget to provide appropriate grants for residents who need to replace sidewalks.
However, the council ignored repeated proposals by Bagwell to cut the city zoo’s budget.
The council will review the budget sometime between August and September after the property valuations are completed and hold a formal public hearing in October.
Not “sales-neutral”
The proposed budget sets the mill levy at 44,462 mills with approximately $ 12.1 million of the $ 35.1 million in fund general property tax expenses.
The Kansas Legislature last passed bill requiring that any growth in property valuation be used to lower property tax rates year over year, making budgets “revenue neutral.”
If this is not the case, the municipality must both publish a legal notice and notify taxpayers of the increase by post, even though it has waived the obligation to post it for the first year. Since real estate valuations in the city have risen by almost 2 percent – mainly thanks to the first tax registration of the Siemens Gamesa turbine plant after ten years of tax exemption – the council has to publish its budget and is not sales-neutral.
To be revenue neutral, the city would have had to cut its milling levy to around 43,588 million, according to Hutchinson finance director Angela Richards, a decrease of 0.874 million, or a tax differential of about $ 10 for a home of $ 100,000. Holding the mill resulted in sales of approximately $ 278,000.
ups and downs
In the initial budget the council accepted, city officials suggested $ 37.9 million for general fund spending, an increase of more than $ 4.2 million over projected spending for 2021. Eventually, the council passed 35 , $ 9 million in general fund spending, an increase of $ 2.1 million.
A large part of the budget adjustment was the department’s commitment to fill more than $ 800,000 currently vacant positions for the remainder of this year, which went into the carryover for next year.
Overall, city manager Jeff Cantrell advised the council, employees found another 10 percent of what they found were their basic needs.
“It’s a painful process,” he said.
The council’s goal from the outset was to maintain a budget carryover of at least $ 5 million through 2023, based on an industry recommendation that communities raise at least enough funds to fully fund operations for two months in the event of a disaster.
After staff returned with the proposed cuts and responded to suggestions from council members, the projected final balance landed at $ 4.1 million, with historical spending trends expected to likely closer to 4.5 million by the end of next year US dollars will be.
The budget also relies on using more than $ 230,000 from health and denture reserves to pay for projected increases in health insurance costs, a move that Richards said the city does not want to proceed.
The plan also cuts several departmental reserve funds and delays a handful of capital improvement projects for at least a year, mostly affecting firefighters, information technology and parks.
Increased software costs
Approximately $ 450,000 in new spending was for software licenses and upgrades, including $ 300,000 for the E-911 dispatch center and $ 150,000 for planning and code enforcement.
The increase in shipping was due to the center more than doubling the number of shipping consoles from four to nine, made possible by the law enforcement center redesign.
There will be no increase in staff at the center, but the facility will allow some consoles to take 911 calls while others dispatch emergency personnel at the same time.
This allows dispatchers to stay on the line with a caller and dispatch emergency responders faster, said Hutchinson Police Chief Jeff Hooper. There are also supervisor consoles and some training consoles.
The bulk of the expense will be on software licensing, which has more than doubled with the addition of the consoles, and it will be ongoing annual expenses.
“We didn’t meet the national standard for dispatchers,” said Hooper. “We did not adhere to the response times of the fire brigade and we did not adhere to the response times to make service calls.”
The council learned that an additional $ 70,000 for utility billing was due to an increase in the number of people paying their city bills online or over the phone using credit cards, which has increased due to COVID-19. The city does not pass the fee on to its customers.
One area where the council agreed not to cut the pavement and maintenance was. In fact, there was a brief discussion about asking voters to continue using the sales tax to pay for the sports arena improvements after it expires in 2025 and to use it on roads.