Budget Comments

Ahhh, the annual budget season is upon us. The jockeying for position as the toughest council member on the city staff has already begun. The concerns over this year's budget are unwarranted because we adequately prepared for the state’s action by not filling a retirement position this spring. This means we have not had to take any further action to adjust this year's budget. The overall city financial position is really quite good and does not justify any radical action at this time.

The city has never received a great deal of state aid, so a 7.6% cut is relatively small. We have always been heavily property tax dependent and the inelastic nature of the property tax cushions the city from severe revenue swings. The city as of June 30th has 73% of revenues budgeted and 43% of expenses budgeted. This is actually slightly better than our historical trends. The numbers can be a little deceiving because the city receives the vast majority of their revenue in January from property tax collections and the city’s expenses are mainly generated during the summer (except for snowy winters).

The overall design of the state’s revenue limits appears to allow enough increase for the city to maintain existing levels of service for next year. The real budget battles this year are going to be over philosophic issues of budget growth and learning the nature of city processes.