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30 Nov 2011 w/ 2 Dec Update    Homepage

Budget Discussion in Administration Committee Meeting (Post Meeting) 


Thursday 1 Dec 2011 City council met to discuss the city budget and possible income tax levy.  You can watch the video of the meeting on the City of Huber Heights website.  If you have not already done so read the Pre-Meeting write-up for context and then come back up here. Before you start reading - the city finance director told us there were six funds getting earmarks.  I do not know three of them and it hurts this article. But we did get a funds report.

Next Monday Dec 5th council will vote whether to put the income tax levy on the ballot.  During last night's administration committee meeting it was decided to ask for two resolutions.  

One of the resolutions will ask residents to allow the city to re-allocate current income taxes.  The re-allocation is necessary because some of that tax money is going into funds that have strong reserves. This will give council the ability to appropriate all the revenue from the income tax in the most efficient manner.  People that would be against this measure would be those concerned with those funds that currently get the earmarks.  For instance the streets fund is currently guaranteed to get a portion of the income tax.  If this measure passes then all the income tax revenue goes into the general fund then council decides how much will get allocated to the streets department.   So if you are really worried about the funding level of the streets department and you think council will really mess up the allocation then you wouldn't want to vote for this measure.  On the other hand, the current way the taxes are earmarked have made it so that the streets fund has a very large reserve while the police and fire funds are quickly depleting theirs.  This resolution holds the best chance of keeping the city's taxes as low as possible.  But it will mean that citizens need to pay attention and make sure they give council proper feedback on how they should be spending our money. 

There also is another part of the first resolution - in Dec 2015 some of the current tax will expire (.18%) this  resolution contains language that will make this .18% permanent.  The majority of this .18% is currently earmarked for police and fire services.  If this first resolution passes this earmark would also go away.  This should be less of a concern for those worried about fire and police because there are not enough earmarks in the current tax cover all the expenses of the fire and police department and council already has to allocate general funds to the fire and police departments.  If this measure does not pass and this .18% expires at the end of 2015 then things get really messed up.  This is because the earmarks would still be in place for the streets fund (and other 3 funds) but there would be very little money in the general fund to allocate to the police and fire. 

The second measure will be the .25% increase to the income tax.  The re-allocation in the first measure is a good start but only addresses a couple of the 46 funds mentioned by the city finance director Monday night. I believe it may be very difficult to re-allocate some of the other funds but I also believe it is a useful exercise to catalog the resources and document the roadblocks because this may lead to a solution other than the .25% levy.

 Budget Discussion in Administration Committee Meeting (Pre-Meeting)


Thursday 1 Dec 2011 City council meets to discuss the 2012 budget and the proposal to increase the income tax rate by .25%.  This is the second meeting on this subject.  The first meeting was Monday and we learned the Income tax is expected to generate $1.6 million a year.  we learned the city is down to $3 million in reserves and the if reserves fall below $2 million this may effect the city's credit rating. There were some off hand remarks about the sewer fund containing $7 million that gave the impression that that the $7 million was reserve funds and that within the 46 separate funds there may be as much as $30 million in reserve.  The statement was made that it would be difficult to transfer these reserves so that it can be used more generally.  With this background and the packet posted for the agenda I sent an email containing the following information asking for council and city finance to provide additional information during the meeting.


I see the Administration Committee meeting agenda and package is available online. 
Beyond what is available currently I believe it should include additional information and I hope finance will come prepared with information about the following.  Per the discussion on Monday night I believe an item of interest would be the 46 funds Donnie Jones mentioned and the approximate $30 million contained therein.  Information that would be useful for each of these funds would include:
1. Purpose and allowable usages
2. Restrictions that prevent it from other uses.  Are the rules council imposed, county imposed, state imposed / federally imposed.  What are the procedure for relief?
3. The amount of "reserve" and/or surplus above expenses within each fund.
4. Projects "in the works" that the reserve would be spent on that the council is investigating that would take precedence over a constant tax rate.
Mr. Jones comments that there was $7 million in the sewer fund and that it was possible for that money to be re-allocated for more general use was intriguing.  With the expectation that the income tax levy would generate $1.6 million a year.  If the identified $7 million is reserve, as Mr. Jones implied, then there would be at least 4 years of reserve that could be used instead of the income tax increase.  I would think there would be interest in learning the reasons why this could not be done as a direct transfer. If not by direct transfer then can we explore brokering a trade for the tax increase for an enforceable reduction in Water and Sewer rates?

Update - the city did provide a funds report that gave some information about the 4 items above.


On a similar vane, from Monday's discussion it appears as if the city is setting up the Aquatic Center account so that it has similar restrictions.  It would be interesting to learn why?  Also, would the proposed restrictions prevent the fund from paying the $150,000 fee the YMCA is to receive for each year for running the parks?  In which line item is this YMCA payment now found?
On a new subject, looking at the appropriations the three items pictured below peak my interest.
To whom is the $185,025 for Council Personnel cost distributed?
How will the $375,000 in the Recreation Activity Center Fund be distributed?  Could the meeting contain a discussion on the history of this fund?  When was it created? How were the funds generated?
Can we get more information on the debt service ($599,880) found in the sewer appropriation?  What are the current bond obligations?  What is the net of the arbitrage between holding these obligations and the $7 million reserve fund?



I look forward to the Thursday evening meeting.



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Video of the Dec 1 Administration Committee meeting

My write up on the funds report distributed during the Dec 1 Committee meeting. 

Administration Committee meeting agenda






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