Kalispell City Council takes stock of its ongoing budget crunch and looks ahead to 2010 in a work session tonight at 7 p.m., at which no formal votes are allowed.
City Finance Director Amy Robertson projects Kalispell’s general fund will finish the fiscal year, on June 30, with $179,538 in cash reserves, up slightly from last month’s projection. In a memo to the city council, Interim City Manager Myrt Webb reports that the budget is balanced between revenue and expenditures, adding, “While the general fund situation may not be getting any better it is not getting any worse.”
Kalispell’s ambulance fund is projected to have an operating deficit of $50,000, up from the previous year’s deficit of $20,000, which will have to come out of the general fund cash reserves if it doesn’t correct itself. The deficit derives mainly from higher salaries and a lower collection rate, according to Webb’s memo.
Looking ahead to fiscal year 2010, which begins July 1, Kalispell is projected to have $10,475,145 in general fund revenues, with $10,403,880 in expenditures and a reserve of about $259,758. These numbers are rough and assume no salary increases for city employees except for longevity and contractual obligations, no hiring unless a replacement is approved, limited layoffs and finding a solution to the ambulance fund deficit. City department heads must now draw up their own individual budgets within these guidelines, so numbers are likely to change between now and the summer.
Kalispell’s entire budget is about $52 million, though most of those funds are self-sustaining or operate on their own, with the general fund making up about one fifth of that budget, but accounting for payroll for city employees, including public safety. All of the city’s funds, other than the general fund, have reserves of at least 10 percent or more, from the Wastewater Treatment Plant’s reserve of 11 percent, to the Community Development Department’s reserve of 44 percent.
While the general fund is stabilized, it is by no means safe. A city of Kalispell’s size, according to most experts, should have a cash reserve of between $1 million and $1.5 million. Whitefish, a city with a small population has a cash reserve of more than $8 million. One public safety emergency or unforeseen expense could easily wipe out the Kalispell’s entire cash reserve.
The Parks and Recreation Department suffered the worst staff and budget cuts in 2008, under the logic that it makes more sense to cut parks maintenance or after-school programs that it does to lay off police officers or firefighters. To stabilize the Parks and Recreation budget, Robertson and Mike Baker, the Parks and Recreation Director, are proposing the Parks department be put in a separate special revenue fund, meaning property tax mills are allocated directly to that department, taking it out of competition for general fund money.
Creating this special revenue fund would also encourage Recreation programs to grow efficiently and would provide additional revenue, in the form of mills, as the city’s tax base grows. But if the council approves of this plan, it would need to approve the fund creation before the next fiscal year begins in July, since much of the Parks and Recreation Department’s budget begins flowing in when summer programs commence in June. The council will discuss this idea at tonight’s work session.
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