Mayor Tony Yarber and the Jackson City Council held a spirited discussion over the budget and reserve fund yesterday. Interim Director of Administration Michelle Battee-Day told the council that the city was forced to use the reserve fund to balance the budget last year and this year. However, an ordinance requires the city to maintain a reserve fund that is 7.5% of the budget. The repeated dipping into the reserve fund will reduce the balance to only $1.3 million later this year when it should be $9 million.
Ms. Day told the council that the city was forced to use part of the reserve fund for the fund balance. The reserve fund last year was deficient $4.187 million (The reserve fund itself was not empty but was $4.187 below the required amount of $9.178 million.). The budget for the 2015-2016 fiscal year had a beginning reserve fund balance of $4.991 million. More spending of the reserve is anticipated.
Mayor Yarber said the council was informed of these transfers and approved of them. However, Councilman Melvin Priester strongly disagreed with the Mayor and claimed it agreed to a budget with a proper 7.5% reserve fund and not one that was deficient. Mayor Yarber said if the council had made the hard decisions on past budgets it would "have made us unelectable."
Councilman Ashby Foote pointed out that property tax collections were 8% higher than a year ago. However, it appears some of this increase is due to reassessed values on homes over $100,000.
Ms. Day made several recommendations about fixing the budget problems in a memo posted below:
a.The city’s proposed financial plan included the establishment of a budget stabilization fund which will provide a mechanism by which funds which exceed budget needs (including the required fund balance) may be set aside.Kingfish note: So here we are. All parties bear responsibility for this mess. They kicked the can down the road. They tried to please everyone by using furloughs instead of laying off people and instead pleased no one. Now they are discussing doing what should have been done last year. Ostriches indeed.
b.The city must re-define our core services. The provision of these core services should be our primary focus as we continue to rebuild our reserves. The city has historically provided services that extend beyond public safety, water and wastewater and infrastructure (streets & bridges) management. Our citizens have benefited tremendously from these services but the cost of providing them has begun to drain the city of much needed resources; which has affected our ability to provide our core services.
c.The city must continue to explore, create and implement additional revenue streams. (i.e. parking meters, explore ways to monetize the city’s assets, explore private management of certain city facilities)
d.The hiring of all non-essential personnel should be suspended.
e.All non-emergency overtime and overtime not previously approved by the department director should be suspended.
f.Requests for non-emergency purchases and travel should be suspended.
g.Reduce funding provided to outside agencies.
h.Discontinue the youth employment and the summer enrichment programs until the city has rebuilt our reserve.