The Kalispell City Council approved a budget for the 2010-2011 fiscal year at its Monday night meeting that pared down spending sufficient to draw the approval of two conservatives on the council who have never before voted in favor of an annual budget: Bob Hafferman and Tim Kluesner.
Hafferman, who has voted against eight previous annual budgets, said he is still concerned by the city airport, impact fees, over-obligating bonds, staff levels and spending on training, vehicles and other “perks.” But he praised city staff for improving public involvement in the budget process and lowering expenditures.
“If the economy of Kalispell continues to stagger, and judging from everything it appears we’re a long way from out of the hole, there will be a need for more changes and more cuts,” Hafferman said.
“There’s been a real effort to mend our financial fences and to follow the rules and regulations,” he added. “Hopefully we’ve turned the corner and finally appear to be at least heading in the right direction.”
Following a series of unusually quick and unanimous votes approving everything from Kalispell’s annual mill levy to storm sewer maintenance, Kluesner joined in Hafferman’s praise.
“This is the first budget I’ve ever voted ‘yes’ for since I’ve been on the council,” Kluesner said. “Bob, you’ve said things well.”
The total city budget, which includes all funds, is $42,214,985 for fiscal year 2010, down from the preliminary budget of $44,495,788 approved by council June 28. That reduction stems largely from eliminating any plans to buy land for the improvement of the city airport and then receive reimbursement from the Federal Aviation Administration, which was budgeted at $2.9 million. Kalispell plans to review its options for that controversial project in the coming year, and is unlikely to make land purchases.
The total city budget for fiscal year 2009-2010 was $47,189,429.
The general fund’s cash carryover, which comprises the city’s cash reserve, between the previous fiscal year and the current one came in at $649,843, and is projected to increase to $900,897 this year. That’s an improvement over the 2008-2009 fiscal year reserve, which was $244,122. In their memo to council, City Manager Jane Howington and Finance Director Amy Robertson credited the improved cash carryover to spending cuts by city departments, particularly the police. Their memo also noted tax collections are down, though the county has collected $92,000 in protest taxes, which could end up being released to Kalispell or refunded to the taxpayers.
The overall general fund, which makes up about one-fifth of the city budget and pays for police, fire and administration staffing, among other needs, is budgeted at $9,072,078, up from the previous year’s $8,578,962. But that’s down from the fiscal year 2008-2009’s general fund spending of $10,070,785.
The council approved a total mill levy of 170.34, which contains the general obligation bonds for the city pool, Fire Station #62, employee health insurance and the general city levy as calculated by the state. Fiscal year 2010’s mill levy was 169.81 and 2009’s was 170.23.
The council voted to keep assessment rates steady for programs like urban forestry, street maintenance and solid waste. But Howington warned the council that they would be voting on a budget containing a 5 percent increase in sewer costs. A public hearing and vote on the sewer rate increase will be held in September, and if the council votes against the increase, the budget will have to be amended.
“We’ve cut that budget as far as we can possibly cut it without really getting into some of the bond reserves,” Howington said. “That would then create a problem with our ability to repay bonds.”
Howington explained she was negotiating alternate places to put “bio-solids” from the city’s wastewater treatment plant that could make a rate increase unnecessary.
“The reason we’re in this situation is that we designed and built a sewage treatment facility that was based on the growth that was going on a number of years ago, rather than the growth we’re experiencing now,” she added. “If growth had continued the way it was a few years ago we wouldn’t be in the situation we’re in now.”
But overall, the city council, with Randy Kenyon and Kari Gabriel absent, was clearly pleased with the budget presented by Howington in her first year as city manager.
“I too would like to compliment Jane,” Councilman Jim Atkinson said. “But I don’t think I can do it anywhere as well as Bob Hafferman can vote.”
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