The Fremont City Council during its Tuesday evening meeting laid out an updated plan of attack regarding the deficit the City of Fremont faces heading into the upcoming 2017-2019 biennial budget.
During the meeting, the Council heard and approved a second reading of the ordinance. A third and final reading will happen during the Sept. 19 meeting and a finalized budget must be submitted to the State of Nebraska by Sept. 20. The new budget takes effect 15 days after the ordinance is finalized.
After dealing with a deficit of approximately a half-million dollars in 2016, the city’s budgeted revenues are not close to matching its projected expenditures heading into the new biennial budget.
After City of Fremont Staff made an assortment of cuts to General Fund expenditures, expenses still surpassed projected revenues by $4 million. This means that approximately $2 million in yearly funds during the 2017-2019 biennial budget aren’t accounted for.
During this week’s Council meeting, four key recommendations were made to address the budgetary gap.
Previous years’ budgets had contingencies built in to allocate funds for future use and capital projects. Approximately $1 million of contingency funds have been removed from the upcoming budget.
“That money was always carried forward to the reserves for the following year,” City Administrator Brian Newton said. “We didn’t spend it so we carried that money forward. We have now cut back on any contingencies in an effort to balance the budget.”
Of the approximately $1 million in contingency funds, about $900,000 remained at the end of this fiscal year in September. That $900,000 is being rolled forward to help fill the void for the 2017-2018 fiscal year, Newton said. Essentially, a portion of the city’s cash reserves are being used to work toward balancing the budget.
Heading into the biennial budget, City of Fremont taxpayers would take a hit with the recommended property tax levy increase of 6 cents per $100 of assessed valuation. The levy would be increased from 32 cents per $100 of assessed value to 38 cents.
This would mean a person owning a home valued at $100,000 would pay an additional $60 per year — $380 instead of $320.
This increase in property taxes would allow for the Fremont Police Department to have enough funds to hire one additional law enforcement agent, Newton said.
Lastly, the City is looking at all services provided.
“We now take a look at all our service, we are still not quite balanced so we look at all the services we provide and all the fees that we charge, and bring those up,” Newton said.
Service adjustments could include: bringing up the cost of building permit fees, filing fees and any fees that are charged by the city.
“This probably wouldn’t happen so much with our parks, auditorium and Splash Station, because we have raised those about every year,” Newton said. “But some of these fees haven’t been looked at for 20 years.”
Numerous concerns have been raised throughout recent years about capital improvement projects getting pushed down the road, but Newton said the unfortunate reality is that the City has to continue tightening its belt.
“Should we continue kicking this can down the road in delaying those projects?” Newton asked. “And the answer is no, but we have to live within our means. It’s kind of like a three-legged stool. You have taxes, you have projects and then you’ve got staff and services.
“So what gives? Do projects give, do services give or do taxes give? Because that is what it really amounts to, and we have to juggle that compromise.”
If approved Sept. 19, Newton said the 2017-2019 biennial budget deficit will be greatly reduced.
“Except for a small little bit this would pretty much wipe out the $2 million (yearly),” he said.