Lincoln aldermen set to approve 2020/2021 fiscal year budget

 

[April 20, 2020] 

For the second time since the corona virus outbreak, the Lincoln City Council met in a closed door session on Tuesday, April 14th. The purpose for this meeting was to review the draft of the new fiscal year budget. The year begins May 1st, 2020 and concludes on April 30, 2021.

The meeting was live-streamed on the city website and the public was able to access the meeting for questions and comments through telephone calls.

Those present for the meeting included all eight aldermen, Mayor Seth Goodman, City Treasurer Chuck Conzo and City Clerk Peggy Bateman. The city department heads were available via telephone, as was the City Administrator Beth Kavelman.

Aldermen observed social distancing with members scattered around the council chambers. During the meeting all the members present also wore face masks as recommended by state guidelines.

The meeting was brief, lasting just over one hour. It was led by Conzo, who presented the budget by department and fielded questions as they arose from the aldermen.

This year the draft budget was prepared by an appointed committee that included Conzo, Kavelman, Alderwoman Kathy Horn and Alderman Jeff Hoinacki. The draft had been distributed to aldermen prior to a previous meeting held on Monday April 6th. At that meeting Conzo offered up a brief overview of expectations for the coming year in regard to revenues. He cautioned the council that with the corona virus pandemic and the shutdown of many sources of sales tax and other state revenue sources, the odds were good that the city would face the consequences with reduced revenues in the new year.

This week Conzo spoke on that again at the beginning of his presentation. He said that the committee had based their revenue projects on the past year. The projected total of revenues taken into the general fund came to $7,697,404. Conzo said it would be reasonable to expect that the number will not hold throughout the year. Therefore, the council should be prepared for future budget adjustments.

Conzo is also optimistic that some of the areas where taxes are not being paid at the moment, such as sales tax, will rebound after the stay at home orders are lifted and ‘non-essential’ retail businesses are allowed to re-open.

The total general fund expenditures budgeted for the new fiscal year come to $7,695,078. In the current budget year the total general fund expenditures total $7,421,155 representing an overall increase in the total of only $273,923.

In the new year there are lines that the council is unable to reduce, such as liability insurance premiums, and the wages paid to fire fighters, police officers and city street workers. The last three city departments are determined through collective bargaining. Those increases in the budget for the new fiscal year totaled $283,892. The budget committee was able to reduce the net increase by trimming budget amounts in lines that they can control.

City Clerk

Conzo noted that Bateman has lowered her budget for the coming year by approximately $14,000. Looking at the comparative budgets, this year there was $46,250 in salaries appointed. In the new year that amount was reduced to $17,319 and $21,972 was added as a new expenditure for ‘salaries-hourly.”

Ron Keller asked Bateman about the software the clerk’s office uses, was it up to date, and did she anticipate any expenses for software in the coming year. Bateman said that the software was working out as is, and she didn’t foresee the city would need to do anything with it in the coming year.

She would later comment on the sewer administration line that is not part of the general fund, saying that increases in office supplies due to monthly sewer billing had caused some increases in those expenditures. That prompted a question from Tracy Welch about the folding machines the city uses. He said he had heard that they were wearing out and causing problems for the staff. Bateman said they are wearing out, but that she had talked to a vendor about the trade in value for the machines and it was way too low. She decided that considering the situation the city is in currently, she and her staff will work through the issues with the machine for this coming year and perhaps in the next budget year make some upgrades.

City Treasurer

Conzo said that ‘by popular demand’ this year for the first time, the city treasurer budget a separate line in the budget. In previous years that budget had been combined with the mayor and aldermanic line. The total for the year is $6,951. Elected official wages are $5,001. The balance is to be used for office supplies, printing/publishing, dues and publications, and travel and training. Conzo said that the printing/publishing line was the highest because there are a number of legal notices that have to be published in print each year and that cost is substantial.

City Administrator

Conzo said the total for the city administrator's office would be $65,295 compared to $61,200 this year. The $4,095 increase includes salary, office supplies and telephone.

The draft was amended where the telephone line showed $4,000 for the new year and $3,000 for the old year. This is where a $700 error had occurred in the first draft. Conzo said that there were two phone lines being charged to the administrator that should have been charged elsewhere. Therefore, the net increase on that expense was only $300, not $1,000.

The aldermen did discuss the phone line with Kavelman via teleconferencing. The size of the bills is based on internet and wi-fi provisions in Kavelman’s contract. The city provides for internet, wi-fi connection, and pays for a city owned cell phone for the administrator as part of her employment contract.

Aldermen did wonder if there was some multiplication of services that could be trimmed back. In the end, they made no changes to the expense amount because of what is spelled out in Kavelman’s contract.

They also expressed concern over the increases in office supplies, not fully understanding why the line is as high as it is, and at the same time recognizing that Kavelman has exceeded the budget in that line in the current year by about $400.

Kavelman said that a lot of that expenditure is for copying. She noted that she is very much a “paper person” who needs to work with hard copies of documents. In addition there has been a massive amount of printing involved in the work she is doing with the Fifth Street land acquisitions.

Kavelman said she was open for suggestions on how to trim those costs, and Welch suggested that one thing she could do was to look into doing electronic signing of documents that are emailed. Kavelman has explained her process of printing, scanning, emailing, shredding, and then re-printing for files the signed documents when emailed back to her. Welch said that there was a means to do electronic signing that would save the first three or four steps. Documents instead of being printed and scanned could be emailed, signed by the recipient and returned via email, and then filed.

Welch also noted that it was a small dollar concern compared to the budget of the whole. However, he said that small dollars add up when they trim throughout all the lines. Kavelman said she would look for ways to reduce her paper use.

Mayor & city council

The line for mayoral and city council expenses dropped from $92,416 this year to $80,870 in the new fiscal year. In that reduction, $5,001 was removed from Conzo’s salary as an elected official, but was added back into the budget as a new line item. Other reductions included dropping the travel and training by $1,500, telephone expense by $3,000 and safety grant expenses by $2,146. The only increase in the budget was $100 for the council secretary moving that total from $5,800 to $5,900.

Contingencies

In the contingencies line, the city will see a reduction in the dollars paid for the centralized dispatch center (911) due to the revised contracts initiated this year. The savings will be approximately $22,000.

The council also removed $20,000 for highway signage. The expense line has been in the budget for the last two years, but is being used in the current year to cover the new welcome signs.

Fire and Police

The fire and police budgets were stable with the net increases to the budgets coming from the increases in wage and benefits as a result of collective bargaining.

Equipment needs for the departments are not included in these budgets but are detailed later in the budget under capital projects.

Building & Grounds

Building and grounds covers the cost of maintenance for city owned properties. The total expenditures were reduced from $161,500 to $156,200.

During this time in the evening, Kevin Bateman did suggest that the city move forward with getting bids on a new roof for city hall. That is not in the budget and Bateman said that it would be good to know what that cost would be, and that yes, if it were possible that the city would have that money this year, it would be a sound decision to go ahead and repair the roof.

Jeff Hoinacki suggested that the city treasurer add a new roof to the city’s appropriation document, but not put it in the budget at this time.

Streets and Alleys

The only significant changes in the street department budget was in the wage and fringe line items, again controlled by the collective bargaining process.

Superintendent Walt Landers was on the phone during that discussion and did suggest that the city consider moving Charity Hutchinson from part time to full time in the future. He said that Hutchinson works as administrative assistant in the office at the Limit Street Public Services building. Her time is divided between Street and Alleys and Building and Zoning. Landers said she has been a great asset and has capabilities that could be shared with a number of other departments within the city.

Health benefits

Insurance premiums for health benefits took a big hit, increasing $113, 232 from $922,393 to $1,035,625 in the new fiscal year. Again, Conzo noted that these premium costs are not something the city has a great deal of control over, as health insurance coverage is also part of the collective bargaining process.

-----

This concluded the review of expenses paid by the city’s general fund.

Conzo also touched on a few other items in the specialized and designated accounts.

TIF

During that time, discussion came up regarding the TIF funding and projected tax revenue. It was noted that the figures are based on taxes accrued in the 2019 calendar year that will be paid in the 2020 calendar year, but after the city’s new fiscal year begins.

The question came from Welch regarding revenues and how they would be impacted by the impending sheriff’s sale of the Lincoln Family Theater. That sale had been scheduled for April 1st, but had to be rescheduled to April 15th, and then postponed indefinitely due to the restrictions for public gatherings related to Covid-19.

Conzo said, yes, there was uncertainty there for the future, but reviewing the way taxes are assessed, billed and paid, he said the impact of the sale would not be felt in the TIF revenues this coming year, but could impact the TIF in the fiscal 21/22 year.

Hotel/Motel Tax

The projected revenue for the Hotel/Motel Tax was held to the same amount as this year - $175,000. Conzo said there was a decrease in travel and overnight stays now because of the stay at home rules, but he is hopeful that when the restrictions on travel are lifted that there will be a resurgence in tourism that the city can benefit from.

To that end, he had increased the dollars for “Additional Tourism Projects & Events” from $3,000 to $5,000 and said the city might want to consider increasing what it invests in tourism to help attract people to the community.

The amount to be paid to the Logan County Tourism Bureau remains the same as this year - $157,523. Conzo said that for this year, that projection was right on the mark, and he is hopeful it will be next year as well. He also noted that the city has $58,000 in reserve in this line item. He said that aldermen may want to consider handing a portion of that over to tourism to help them out in the coming year.

Steve Parrott did share that the state grant for tourism for this year has been suspended. A portion of that grant had been paid to the bureau, but it is still going to lose several thousand dollars. To date, the state has not advised the bureau as to whether or not a tourism grant will be given out in the new fiscal year, which for the state will start on July 1st.

It was also noted that there is $2,000 in the budget for the Dock Dogs event that would have happened during the Pigs & Swigs Festival this year. Kevin Bateman said that the event would not be happening. Conzo noted that the dollars in the new budget could be held there, as the deposit for the Dock Dogs for the summer of 2021 will be paid prior to the end of the city’s coming fiscal year.

Third Friday’s

The new budget for Third Friday events is the same - $5,000. Welch asked the council to up that amount to $6,000. He said that the committee has ideas to improve the monthly summertime events this year, and would like a little more money to be able to follow through with those ideas.

Building & Grounds/Building & Zoning

The aldermen were also advised by Building and Safety Officer Wes Woodhall that the request to demolish the city owned building on North Kickapoo Street has been removed from this year’s budget. Woodhall said the building was not a threat to public safety and can wait until a better time financially.

Kevin Bateman suggested the city consider selling that property, but some aldermen as well as Walt Landers and Mayor Seth Goodman had reservations about doing so because it would be hard to control how the property is used if sold to someone else. Bearing in mind that the building is on the Route 66 route through the city, aldermen don’t want to see something unsightly come to the property.

-----

The city council is expected to vote on the draft budget this evening (Monday, April 20th). If the council chooses not to vote at this time, then it will be forced to hold a special voting session prior to the end of April.

Prior to the regular voting session tonight there will be a Public Hearing for the budget.

Both meetings will once again be closed to the public, but those wishing to view the meeting may do so by logging on to the city of Lincoln website. Those wishing to make comments during the public hearing may do so via telephone. The phone number to call is 217-735-1612, extension 1.

[Nila Smith]