LAKE FOREST PARK — The overall highlight of the mayor’s proposed balanced budget for 2006 may be more of a high point — the budget shows a positive balance for the next five years.
“This is the first time we’ve had a positive budget for a five-year projection,” mayor Dave Hutchinson said.
To accomplish a positive balance for the next five years in the $21.7 million budget, Hutchinson proposed new policies that will change how the city handles reserves and pays for city hall debt. Hutchinson proposes using $200,000 in real estate excise tax dollars to fund the annual bond payment for city hall debt, rather than relying entirely on general fund dollars for the payment. He also suggested capping city reserves.
John Hawley, city finance director, said paying for city hall debt ($2.5 million, which is expected to be fully paid off by 2016) from capital funds, was not achieved sooner because it would have meant less funding for capital projects the past five years, such as city parks.
It is also recommended that the city cap its reserves, Hawley said, because the city has been building up reserves for the past five years and is now at the point where they have decided the amount set aside is adequate for the city. The city has accumulated $1.9 million in annual operating reserves, and during the past four years has used any extra general fund resources to build a $600,000 city council contingency fund and a $1.4 million unallocated reserve in the long-term bond fund.
If the city caps the reserves at the current levels and discontinues transferring dollars out of the general fund, the city will generate an anticipated $108,000 in 2006 for the general fund.
“We are not bringing in more revenue or spending less money,” Hawley said, “But just making some accounting changes which are policy issues for the Council to decide.”
Other budget funding highlights include money earmarked for Towne Centre redevelopment, transportation and emergency preparedness.
For Towne Centre redevelopment work, $30,000 is included in the planning department budget for consultants to provide technical and financial analysis in negotiating a development agreement. For transportation improvements, $50,000 is included for planning and design work for review of safety improvements to the NE 178th corridor, between 40th Avenue NE and 33rd Avenue NE.
An allotment of $25,000 would be used to assess options to improve the safety of vehicular and pedestrian access to Towne Centre from the Sheridan Heights and Hamlin Road neighborhoods, as the current vehicular bridge is unsafe and in need of replacement.
For emergency preparedness, $25,000 in the police department budget would fund an “Are You Ready?” program for residents to ensure self-sufficency for a minimum of three days in the event of a natural disaster. Of the $25,000 total, $20,000 is designated for the city to become part of Emergency Services Coordinating Agency.
Last year, Hutchinson said Council decided not to join ESCA and favored having emergency preparedness services in-house, which he said is difficult for a small city.
“It would include homeland security … it is impossible for a small staff to keep up on that,” Hutchinson said. “Now we are in that discussion again this year.”
The budget also includes $20,000 for Third Place Commons, which Hutchinson expects Council members may see as frivolous, although he says it is important to fund community center services.
“I think an investment of $20,000 is pretty small for what we get,” Hutchinson said. “I think the arguments on the other side are that we pay for essential services and these aren’t essential services.”
The budget also includes $50,000 to study the potential for the city to get involved in the water service business. The proposed budget includes $170,000 to move forward with implementation of the park master plan for the Grace Cole memorial nature park improvements, to include design, trails, plantings, a boardwalk, signs, fencing, a parking lot and other improvements.
The budget, by law, must be adopted by the end of December. The council will continue to discuss the budget until then.
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
