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Proposed budget uses fund balance

The proposed 2015 city budget presented to the Clintonville City Council included using fund balance to balance the budget.

That was the recommendation the Finance Committee agreed to at its meeting, Monday, Nov. 17. The only caveat is cuts equal to the amount of fund balance used need to be sought out by March 31.

The budget was schedule to go before the public and the entire council, Tuesday, Nov. 18.

Interim City Administrator Chuck Kell provided the committee with several highlights of the proposed budget.

The proposed 2015 city budget is a balanced budget with a tax levy totaling $1,981,667. The assessed value tax rate is $8.62, which is four cents higher than 2014, Kell said.

Wages will be frozen for all city employees except those for unionized police officers.

No new employees or positions have been authorized to be hired in the city in 2015.

The proposed budget utilizes $176,102 of the city’s undesignated fund balance to balance the budget. Kell acknowledged typically a city doesn’t want to use those funds for recurring operating expenses.

Kell said the city is faced with several one-time cost issues. This includes the loss of $89,000 in expenditure restraint revenue. He said this is due to the budget the council passed last year.

“In my opinion that should have never happened,” Kell said.

He added that the proposed 2015 budget qualifies the city for the expenditure restraint revenue for the 2016 budget.

Kell said the proposed budget also includes $35,246 for the ambulance program to replenish its fund balance.

“They spent down their fund balance over the course of years and they’re looking for funding from all the communities to build that fund balance back up,” Kell said.

The budget also includes a $5,000 Affordable Care Act assessment on all employees covered by the city’s health insurance plan.

To limit the amount of fund balance used to balance the 2015 budget some city services would have to be cut or eliminated, Kell said. This could include closing the city’s outdoor swimming pool and Recreation Center. It could included an across the board cut to all departments. It could also include raising taxes. To cover the entire shortfall, an additional 77 cents per $1,000 of assessed value would have to be implemented.

Alderman Bill Zienert had previously suggested passing a balanced budget using fund balance on the condition that a more detailed study be completed by March 31, 2015 to identify cuts to city expenditures that would eliminate to use the fund balance in 2015. This would be completed by city departments, city committees and the council. Public hearings would be offered to involve the citizens in the discussion.

Kell recommended using Zienert’s idea.

Committee Chairman Mark Doornink presented a second scenario for a budget. This one would include increasing the tax levy by $55,663 and reduce the use of fund balance by the same amount. This would result in a 17 cent increase to $8.86 per $1,000.

This proposal would maximize the city’s taxing authority and reduce the amount of fund balance needed to balance the budget.

“My scenario would be in line with what we’ve done in previous budgets, where we have increased our levy limit to the amount allowable to pay our debt,” Doornink said. He added that the first scenario presented would be a departure from how the city budget has been done in the past.

“I’m not in favor of raising taxes. I’m also not in favor of kicking the can down the road and having somebody else pay for it next year. I want to let 2015 pay for itself as much as it can,” Doornink said.

A lengthy discussion ensued regarding cuts to the budget, and raising taxes.

Zienert made a motion to recommend scenario No. 1 in the budget book levying a $8.62 tax rate and using $176,102 from the fund balance to balance the budget and then charging the Finance Committee to work with the department heads, administration and citizens to present a plan to replace the fund balance supplement with like cuts in the 2015 operating budget.

The motion passed 4-1. Doornink voted no.

The budget was presented to the public and the entire council on Tuesday, Nov. 18. See next week’s Tribune-Gazette for details about the 2015 budget passed by the council.

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