Future of San Angelo's Budget Waits in Limbo

Tuesday morning, the City Council discussed what possibilities are in San Angelo’s future during the regularly scheduled meeting.

Morgan Chegwidden, Budget Manger for the city, started the discussion with the council during a budget workshop meeting that took place Thursday of last week. The meeting covered the fiscal year (FY) 2017 budget.

During the meeting, two goals were kept in mind for the discussions: 1) Major funds, revenue and expenditures involving the city, and 2) Council priorities and goals.   

“Where we are in the budget is with the sales tax deficit we are facing, which showed property tax growth due to new properties being added to the tax roll and appraisals for properties at market value,” Chegwidden said.

She noted there was a 3.8 percent increase in the property tax. This yields $1.3 million dollars in marginal revenue for FY 2017.

It was brought to the attention of the council that sales tax was down August to August by under nine percent going into FY 2017. The deficit currently sits at $2 million, and that means the original budget that was approved will not meet those demands.  

Overall, $17.2 million dollars was proposed during the workshop for FY 2017 budget. Chegwidden noted this is a reduction of $2 million dollars from FY 2016's original budget. She said $16.7 million is projected to end FY 2016 with a three percent growth rate that could create the proposed budget for FY 2017.   

Chegwidden also mentioned that the public and various program managers have reported the services being provided by the city are used frequently, and are important to the citizens.

Services do go through an evaluation processes to decide when the city needs to cut to save money for the budget. These cuts are looked at annually, Chegwidden explained.

“The best case scenario for this year’s budget is to maintain those services by providing excellent service for each program [the citizens] are using,” Chegwidden said.

These programs include water delivery, and recreation with congregate meals that are used for events.

She added, “It’s important to note [the city] is retaining those service levels.”

Chegwidden noted a marginal revenue of $322,000 for the council to decide what programs they wanted to expand.

She explained the general fund revenue was reported at $69.8 million, and expenditures at $69.5, showing the revenue over the expenditures. This leaves the $322,000 that can be used by for project funding.

Michael Dane, Assistant City Manager, suggested temporarily placing the budget in an expense line item until further research can be finalized. This was voted on during the budget workshop.    

Following yesterday’s City Council meeting, some council members discussed what their expectations are for the various projects regarding the FY 2017 budget.

Lane Carter:  

“Each department is putting their funding on hold to see what money is available down the line, looking at non-accentual items that can be put on hold. $322,000 for a city is not much money to break even regarding the programs that are a priority,” Carter explained.

Charlotte Farmer:

“I was disappointed in our budget workshop,” Farmer mentioned.

Because these discussions were passed with a minimum of four votes for approval, she felt the council members missed out on their opportunity to speak of their concerns with the budget.  

“I would like to see us look at our fund balancing and see what percentage of the budget has been utilized.

Farmer added, “I’m particularly interested in any excess in the budget and fund balances.”

She was alluding to the fund balances that are used to pay for programs that haven’t been finished yet.

She also discussed collecting money for storm water rates that was already mandated to the city with no funds. Farmer mentioned discussions needed to happen to see if the rates needed to decrease, or increase annually.   

Until the further research is completed, Chegwidden explained further updates in the budget discussion wouldn’t happen until next month.

The tax levy ordinance for the .776 cents public tax rate was approved during the August 2nd city council meeting, and will be brought to the council on September 6. This was part of the state’s best practices to keep transparency to the city's constituents, Chegwidden said.