The Monett City Council has proposed a $39.2 million budget for fiscal year 2011-12, beginning on April 1. Several major projects are included as the city anticipates improved economic conditions.
According to the budget statement released at the February council meeting, the proposed budget represents spending that exceeds projected income by more than $4.7 million.
Payment from the Missouri Department of Transportation (MoDOT) for its portion of the last expansion on Highway 60, arranged as part of the innovative financing deal, will be paid during the year, making up the difference. Additional money will be provided through the Recovery Zone Economic Development bonds paying for the water main loop and upgrade around the city.
Several major projects will be added in the coming year. This will be the first year of the city's participation in the Downtown Revitalization and Economic Assistance for Missouri (DREAM) Initiative. The city will spend approximately $13,500 as its 20 percent of the project in the first year.
Council members have committed $33,000 to a flood mitigation study, of which $10,000 will be reimbursed through the DREAM initiative.
A major new project in the coming year will be moving forward on the water system upgrade. Engineering has been budgeted for the new water treatment plant targeted for the old Rutherford farm that will treat muddied well water. The project was originally estimated in the $13-million range, with the addition of a major water main loop to bring water from the chronically muddy wells to the treatment plant.
According to Utilities Superintendent Pete Rauch, the city has since secured some low-interest funding to offset the cost by approximately $2.5 million. City water department crews are installing the northern portion of the main loop, thus saving more money.
A revenue bond issue to finance the project will be put before voters in August. Passage of the bond issue will not affect water rates, which were raised earlier to cover the undertaking.
Total budget for elections is $10,000 and includes a primary for council members in February 2012.
Ongoing work on the water distribution and transmission system will include installation of new water lines from Chapell Drive and Cleveland north to Farm Road 2230 in Lawrence County, west to Highway H and Eisenhower. A similar main loop is underway on the south side of town from well #15 on Moge Road to South Eisenhower and north from well #21 on the Jack Henry and Associates campus.
A booster pump station to increase water pressure is also budgeted. A well house and chlorine detention line for the well on the Jack Henry property are also planned.
"The budget includes a cost of living increase to the approved pay matrix of 1.5 percent," the budget statement said.
The raise will not represent an increase in spending over last year's budget for wages and salaries. The number of full-time employees has dropped from 117 to 115 during the year. Salary increases for full-time employees has dropped by less than one-half of 1 percent over the last fiscal year because of the staff reduction.
Health insurance costs are expected to rise by an average of 8.6 percent. The city had been quoted a much higher increase but reduced the final cost by changing health insurance carriers and switching to higher deductibles and co-payments for employees.
An increase in workers compensation costs is expected due to a number of claims the past two years. Claim history has improved of late and is expected to provide a benefit in the future.
After budgeting for falling sales tax income over the last two fiscal years, the new budget estimates sales tax income will rise by 1 percent over the 2010-11 year. Through February, sales tax income had improved by 1.3 percent over the previous year.
City Administrator Dennis Pyle indicated the city expected no real increase in revenue but rather anticipated a stabilization that meant an end to the drops that characterized the economic downturn that started in February 2009.
The city's business license tax on cellular phone service providers is expected to generate $255,750 during the year. Settlements with seven cell phone companies for contested back taxes helped offset the 10 percent decrease in sales tax income received since 2008.
The city is scheduled to pay $3,710,000 on its tax increment financing (TIF) projects on Oct. 1. Litigation by Barry and Lawrence counties has resulted in ongoing sales and real estate tax income for Monett's TIF to be placed in an escrow fund, unavailable for the debt payment. The city's portion of TIF monies are still being deposited in the Special Allocation Funds.
Money being reimbursed from MoDOT will cover the 2011 payment. Pyle indicated adequate funds are available to cover the the TIF bond payments for 2011-12.
The city's general fund is projecting total revenues of $7,577,716 for the coming year with spending of $7,577,660. The general fund balance as of Feb. 1 was 17.5 percent of expenditures, or $1,329,552, going into the new year.
Total revenues expected in the 2011-12 fiscal year total $33,545,606, including income from utility sales. Spending is budgeted at $39,284,566.
The full budget statement and all the budget numbers are posted on the city's website at www.cityofmonett.com.