Proposed city budget tops half-billion mark

After a series of four study sessions on the topic, council gave first reading to an ordinance to adopt the city’s $507 million budget for the fiscal year starting July 1.

This includes $110 million in the general fund.

Council is scheduled to vote on the budget measure on June 10.

City Finance Director David Holtmann told Springfield City Council at its May 20 meeting that the city charter requires a balanced budget.

“We need to make sure that we are planning to pay for all of our ongoing expenses with ongoing revenue sources to ensure that we don’t have to make cuts the following year,” he said.

Holtmann said the proposed budget is up roughly $15 million from the current year. This year, he said, revenue growth has slowed to the traditional levels, with a 2%-2.5% increase from last year.

“I will say that’s still positive news in that no one wants to be in a director’s position when they would be facing declining revenues, so we’re still able to make good progress on what we have been doing,” he said.

The proposed budget includes funding for the position of the director of Building Development Services at $100,000 with an additional $45,000 for vehicle and computer funding, he said.

He added that 63% of the city’s revenue growth is being used for pay plan improvement as part of a focus on employee retention and recruitment.

“Between that and accounting for our inflationary measures, that eats up almost all of our new revenue for that,” he said.

He added that the city’s three-quarter cent police and fire pension sales tax, which brings in roughly $45 million per year, solely for the pension fund, will be expiring. That revenue will be received for only three quarters, which means there will also be a reduction in use tax that is collected as a result of the police and fire pension sales tax.

Normal sales tax will be reduced by about $11.2 million, with a decrease in the general fund and transportation fund of roughly $650,000, he said.

He noted about $6.5 million is proposed for capital improvements for the Expo Center to address deferred maintenance issues.

More details from the proposed budget will be presented in the June 3 issue of Springfield Business Journal.