City Council spent the better part of three nights this week discussing the city’s budget for 2017. The good news is that revenues are projected to track ahead of expenditures for the next five years according to staff. The bad news is the Capital Projects Fund will be spent down in the near future requiring new revenue sources.
The budgeting practice is to transfer 17% (this equals two months of operating expenses) of our General Fund budget to the Capital Projects Fund at the end of each year. That money is then used to fund capital projects. If the General Fund balance is not sufficient to transfer the 17% then the dollars for projects are diminished. In the near future the dollars to transfer from the General Fund to the Capital Projects Fund will not be sufficient to meet the needs. But is the problem really all about revenues or is there another possible answer?
If you correlate the city’s budget to your own budget it would look like this. Your income exceeds your expenditures but you know you will need a new roof in two years and you will need new tires for your car next year. You could continue to spend as always hoping that more income is earned or you could start saving for the new roof and tires. That may require giving up something – vacationing in Colorado instead of traveling Europe, more entertaining at home rather than going out – you get the picture. You start cutting expenditures to prepare for the future expenses that you know are coming.
But there was no talk of cutting expenditures in the three nights of discussion. Comments were made that the future “problem” is a revenue problem; more is needed. Littleton’s budget in 2014 was $52,578,078 and is projected to be 62,747,030 in 2017 – an increase of 10,168,952 or approximately 19% in 4 years! Do we really have a revenue problem? If so, how much is enough if 19% growth in 4 years isn’t enough to keep up with expenditures?
At the end of the meeting, acting city manager Mark Relph addressed the path forward saying they have time. Programs and services need to be evaluated and they (council) needed to look inward. We hope that means taking a good look at the expenditures before making a decision to increase taxes, add taxes, or ask for a bond issue. Making our community safe by providing for police, fire, and well-maintained infrastructure is exactly why we pay taxes. They are the necessities. Before the “frills” are budgeted the necessities have to be provided for – if the frills are desired then ask the voters if they want to fund them!