Let’s say your neighborhood or homeowners association has in its plans for the upcoming year a series of repairs, renovations and additions but, as it prepares its budget for all these projects, discovers that what it needs to accomplish will cost, say, $1,375 more than can be covered via the regular monthly association assessments or dues.
Then someone on the board says "I’ve got an idea. Remember when we sponsored that fund-raising community-wide garage sale last year? We netted over $800 on that project. Let’s have another one of those but this time we’ll expand it to include a bake sale, but not one where residents just sell their homemade pies, cakes and cookies. Let them sell casserole dishes; canned peaches; homemade jellies, jams and preserves. Include arts and crafts so that our residents can try to sell homemade candles or their own artwork."
The rest of the board agrees, the event is held, and it nets $1,135. You can look at this result in two ways. The first way is to congratulate yourself for having a much more profitable event than the one the year before. But the second is that you fell short of your goal and now decisions must be made on how to scale back your repair-renovation-addition plan.
That’s sort of the position the City of Kyle finds itself in today. It can congratulate itself in the realization sales tax collections this month were up $54,853.88 (9.1 percent) over what they were for the same month last year. However, the city must also deal with the realization that this number is $36,668.59 (5.2 percent) below what the city’s current budget projected it to receive.
Having said that, there’s no reason to panic.
Yet.
But it does raise a concern because last year the city finished its fiscal year with more than a quarter million dollars — $281,897.11, to be exact — less in sales tax revenues than that budget forecast and yet, at this same juncture last year, the city was $122,371.19 above projections versus the $29,640.40 hole it finds itself in this year. That means the city, during the course of the preceding fiscal year, nosedived $404,268.30 in sales tax revenues during the final 10 months of the fiscal year.
The city is looking to hire, among other positions, some street technicians and I would guestimate that someone working in that position for the city of Kyle is going to make close to $26,000 a year and, when all the benefits, such as health insurance, pension contributions and the like, are factored into the equation, this deficit means the city, for example, might have to add one less street technician to its payroll than it originally planned. That, of course, also means one less person to work on the much-needed and wanted construction and maintenance services on our streets, alleys and sidewalks.
I’m not saying that’s going to happen, so don’t start lamenting our city is going to fall into mass disrepair. I’m just using that as an example of how this deficit for November might be addressed.
But what is going to happen if these gaps continue? Not hiring that street technician only makes up for most of this month’s deficit. But what is the city going to do if this trend not only continues, but if, in a repeat of what happened last year, the monthly gaps become considerably larger?
Which brings me to my real point here which is the public doesn’t know exactly what is going to happen. We don’t know precisely how the city plans to deal with having less money to meet its needs than it originally planned for. A budget is, because the moneys that pay for the expenditures outlined in it come from the public, is essentially a contract between its citizens and the city. The city has agreed to perform all these services for us in return for all this money we are giving them. Therefore, the city owes us a revelation of what areas will not be addressed due to budget shortfalls.
It doesn’t have to come now. But, to give you just one example, City Engineer Leon Barba stands before the city council at least once a month to present an update on the progress of the road bond projects. Once a month he does this. All I’m recommending is that once a quarter City Manager Scott Sellers or Finance Director Perwez Moheet stand before the council and publicly announce what adjustments they are planning to make in the city’s spending to compensate for the budget gap.
Because we, the public, entered into this contract with the city in good faith, we should, as a matter of course, be given periodic updates on its side of this contract. The city certainly expects us to pay our property taxes, our sales taxes and all the other fees that comprise the city’s income. In fact, there are legal penalties involved if we don’t. By the same token, we should be kept informed on how the city is fulfilling its side of the bargain.
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