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Lott offers budget plan

• Albany's administrator talks elected officials through the major points of a preliminary budget for th fiscal year that starts July 1.

Barbara Rivera Holmes

ALBANY — The Albany City Commission began budget proceedings Tuesday following a presentation of the city manager’s proposed fiscal year 2009 budget of $100.1 million.

The budget, presented during the commission’s 8:30 a.m. work session, represents a 1.6 percent increase, or $1.58 million, over the adopted FY 08 budget of $98.53 million.

Albany City Manager Al Lott pointed out that the most significant factors in drawing the preliminary budget include the property tax revaluation; a decrease in real revenue; a 15 percent increase in group health insurance ($1.45 million); rising fuel costs ($466,945); workers compensation reduction; and a transfer from the fund balance.

REVENUE

According to Lott’s budget recommendations, the three largest funding sources for the general fund, which accounts for about 70 percent of the balanced budget, are:

• Property taxes: $15.2 million, or 29 percent of general funds
• Sales tax: $9.1 million, or 17 percent
• Water, Gas & Light Commission transfer: $7.1 million, or 14 percent.

According to data presented by Lott for fiscal year 2009, the three revenue sources are trailing 1 to 2 percentage points below the FY ’08 estimates.

“The property tax revenue is a significant issue. Our projected numbers have not panned out,” he said. “The total tax digest for Dougherty County ... is coming in at $1.5 billion as opposed to the predicted $1.6 billion. ... So that’s $100 million less than what (we) thought.

“It’s a significant amount of money and it affects how much we get,” he said of the city’s 9-mill stake.

A rollback of 1.618 to a millage rate of 9.159 equals an FY ’09 decrease of $2.57 million, or $17.15 million versus $14.58 million.

To offset the difference without increasing taxes but maintaining services, Lott proposes a transfer of $2.07 million from the unreserved fund, which stands at a “healthy” balance of $24 million. Of that, $15 million is in cash subsidies, said City Finance Director Kris Newton.

Pressed by Commissioner Bob Langstaff, Newton said she expects the reserve fund to increase “slightly” by the end of the fiscal year. She noted that summer and fall are, fiscally, the city’s “tough times.”

At $24 million, the city has a nearly 50 percent match of its general fund in reserves.

“We have almost 50 percent, so it’s prudent and right for us to utilize (the reserves) and mitigate the burden on taxpayers,” Lott said.

In terms of property tax revenue, the FY ’09 prediction is $290,072 below the FY ’08 estimate, yet still higher than in FY ’07 ($15.02 million) and the preceding fiscal years.

The nation’s slowing economy will show itself in the city’s sales tax revenue, although not too badly, Lott said.

“We have not suffered significantly from the recession, which I think we are in,” he said.

Although the FY ’09 proposed collection of $9.1 million is higher than the FY ’08 estimate of $9 million, it’s lower than that of FY ’07 collection of $9.18 million and FY ’06 collection of $9.2 million.

Still, the prediction for the fiscal year that starts July 1 is significantly higher than collections for fiscal years 2003, 2004 and 2005, which were $8.02 million, $8.58 million and $8.4 million, respectively.

EXPENSES

The proposed budget’s major expense is personnel, which accounts for $48.84 million, or 50 percent, of the FY ’09 budget.

“We touch our residents and communicate with them everyday,” he said.

To that end, the budget includes a 3 percent cost-of-living increase.

Included in Lott’s budget are funds for four additional code enforcement officers (two law enforcement officers and two housing/code inspectors), three groundskeepers and two system analysts.

The city manager recommends allocating $35.72 million, or 36 percent, toward operating expenses; $14.3 million, or 14 percent, toward capital improvements; and less than 1 percent, or $250,000, for contingency.

Broken down by fund, Lott’s $100.1 million operating budget details:

• General/special funds: $71 million, or 70 percent of total budget
• Transit system: $2.53 million, or 3 percent
• Albany Civic Center: $1.54 million, or 2 percent
• Albany Municipal Auditorium: $93,657, or less than 1 percent
• Southwest Georgia Regional Airport: $1.34 million, or 1 percent
• Solid waste: $8.6 million, or 9 percent
• Sanitary sewer: $15 million, or 15 percent.

VARIANCES

Compared to the budget for the fiscal year that ends June 30, the FY ’09 budget shows:

• General/special funds: $1.3 million increase, or 1.85 percent, over FY ’08
• Transit system: $284,048, or 12.67 percent increase
• Albany Civic Center: $32,333 increase, or 2.14 percent
• Albany Municipal Auditorium: $6,605, or 7.59 percent increase
• Southwest Georgia Regional Airport: $59,781, or 4.69 percent increase
• Solid waste: $305,787 decrease, or 3.44 percent lower
• Sanitary sewer: $214,875 increase, or 1.45 percent.

The budget includes 2.9 percent rate increases for solid waste and sanitary sewer; an additional $750,000 from WG&L; $150,000 for Albany Tomorrow Inc.; and funds to maintain the trails and Ray Charles Plaza.

In light of its new strategic plan, Lott also recommends funding the Albany-Dougherty Economic Development Commission at its requested $250,000. For FY ’08, the city allocated to the EDC $200,000, $50,000 less than its request.

He noted that the the proposed budget doesn’t include $200,000 in Civic Center promotional funding; raises for Municipal Court-appointed officials; an extra staff attorney for the city; nor additional staff for the city clerk’s office.

The commission will begin departmental budget reviews on April 12.

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