City approves budget

FISCAL YEAR: City Manager Steve Sobers (left) and Treasurer Jonathan Locke presented on Monday to city commissioners the city’s 2012-13 fiscal year budget. Commissioners unanimously approved the document. (Pioneer photo/Jonathan Eppley)

Money found in sanitation fund helped balance spending plan

BIG RAPIDS — City Commissioners unanimously approved on Monday the city’s 2012-13 fiscal year budget.

The approved document has more than $7.69 million in projected general fund revenues and more than $7.75 million in expenditures. The city projects more than $1.35 million in its fund balance to help cover the gap. The city’s fiscal year starts July 1.

City Manager Steve Sobers and City Treasurer Jonathan Locke presented the budget to commissioners during their regular meeting on Monday at City Hall. The pair were available to commissioners to answer any questions they had about the budget.

“There are no funds that are projected to be in a negative balance,” Locke said. “Another positive note is the projected ending fund balance for the general fund, which is going to be higher than what we thought.”

About $200,000 of the projected revenues come from an accumulation of money discovered in the city’s sanitation fund. Money the city billed residents above what it charges for Allied Waste garbage pick up — including leaf pick up and landscaping blight enforcement — should have been transferred into the general fund. However, an accounting error held the money in its sanitation fund.

Although the discovered funds are assisting in balancing the budget, Commissioner Lorraine James warned that the city should not rely on having the same balance next year.

“We were lucky enough to find that extra money in the sanitation fund; I looked at that as a big adhesive bandage that we found,” James said. “That helped the fact that we don’t have a big difference between the revenues and expenditures, but we’re not going to find that $200,000 ever year. I would caution city staff to be fiscally responsible for their independent budgets and to watch them closely because I’d hate to see us have to make tough decisions and lay off staff (in the future) because we can’t get a budget put together.”

Mayor Mark Warba

In an effort to cut expenditures, the budget was proposed with two fewer city employees. Sobers expects two employees to retire or take employment elsewhere, which is expected to save the city about $82,000.

“As people leave or retire for some reason, at this time next year we will be two less people less,” Sobers said. “One of the things we keep trying to look at, as we look realistically at revenues, is to have a good number of employees and a good number of equipment for them to get things done.”

Locke began as treasurer in February and quickly had to learn about city finances to prepare the 2012-13 fiscal year budget. Commissioners lauded Locke for his speed and accuracy in presenting the budget. He also was assisted in the budget process by Sobers and James, who was the city treasurer for 25 years.

In other news, commissioners also unanimously approved a new user charge methodology for wastewater services provided to Green and Big Rapids townships.

City and township officials have worked closely together during the past two years to complete a report that updates the formula by which the townships are billed. The new formula reflects the cost of services and the $8 million in upgrades made to the city’s wastewater treatment facility in 2010.

The Big Rapids Wastewater User Charge Report will be reviewed by the two townships, as well as the Michigan Department of Environmental Quality for final approval.

“This is the most well-rounded study and report where the folks working on it actually gained a broader understanding of the whole process,” said city attorney Eric Williams.

The amount billed to the two townships will depend on how much flow each uses and any new upgrades or improvements made to the wastewater facility. Big Rapids Township uses 10.29 percent of the plant’s average flow, and Green Township uses 2.59 percent — or nearly 13 percent between the two townships.

The city will review the factors that go into the formula every year to make sure city the townships are billed the proper amount.

How the rate increase will affect township residents will be up to township officials. The two townships will have to determine if they will increase the amounts billed to their respective residents.

“To appreciate where we’re at, you need to have seen where we started,” said Mayor Mark Warba. “We’ve been dealing with contractual agreements that date back to the late 1970s, with an amendment in 1995. What this does is it gets us to a point where anyone will have the ability to look at the methodology and understand it.

“If you look at the prior contracts, they were written from a more engineering or technical perspective and not from a financial one. Part of the success of this approach is that we’ve taken that into account.”

Commissioners also approved spending up to $333,800 for the repair of its two drinking water reservoirs, specifically the roof replacement of the larger of the tanks. The smaller tank requires only minor repairs.

MC Sandblasting and Painting, of Newaygo, was awarded the contract to renovate the city’s 1-million-gallon and 500,000-gallon reservoir tanks at the water treatment facility.

avatar

Posted by Jonathan Eppley

Jonathan Eppley is news editor for the Pioneer. He designs and copy edits the Pioneer daily, and manages staff in the evening. Eppley joined the Pioneer staff in 2010. He can be reached at (231) 592-8357 or at jeppley@pioneergroup.com.

Leave a Reply