City officials plan to add staff next year

Fayetteville council set to OK $168 million budget

FAYETTEVILLE — City leaders next year will add key staff positions but face a budget deficit in the general fund and uncertainty with county-imposed jail fees.

The City Council reviewed its 2019 budget Saturday. The council is set to formally approve the budget during its meeting Tuesday.

The $168 million overall budget is up about $7.2 million over this year’s budget. The biggest changes are in personnel, up 34 percent, and services, up 13 percent.

Citywide personnel expenditures are budgeted for about $57.4 million next year. About $1 million more is dedicated to a range adjustment for uniformed employees, meaning police and firefighters. The council in spring adopted a pay plan for police and firefighters after several committee meetings with union representatives and city administrators. Personnel costs for nonuniformed employees also are up nearly $823,000.

An increased demand for water and an allocation to fix pipe leaks throughout the city prompted a higher

budget to buy treated water from Beaver Water District, Chief Financial Officer Paul Becker said. The budget calls for $8.6 million in purchased water, up $1.1 million for this year’s adopted budget.

The $48.1 million general fund, which accounts for nearly 30 percent of the overall budget, has a projected deficit of $846,000. Council members reviewed the general fund in September and anticipated the deficit. Becker estimated the city would make up the deficit in about three years if sales tax growth stays steady.

Becker conservatively budgeted for a 2 percent increase in sales tax revenue next year at nearly $29 million. Sales tax revenue has held a steady 4 to 5 percent increase over the last several years. Sales tax accounts for about 60 percent of the revenue for the general fund.

The council also agreed to dedicate $100,000 out of the general fund reserve to put toward an economic development position specializing in retail. The general fund reserve should have about $5 million at the end of the year, Becker said. The plan council members agreed to would have the new position evaluated after a year.

The city already has economic development contracts with the Chamber of Commerce and local entrepreneurial group Startup Junkie. Part of the chamber’s mission involves retail, but the new position would go beyond the chamber’s scope.

Economic Vitality Director Devin Howland said whoever is hired would be in close contact not just with target retailers, but the developers and lease agents associated with them. The job would involve seeing what works in other cities.

Much of the city’s retail stock is antiquated, and the state doesn’t have a lot of the tax tools that other states have, Howland said.

“This position is about not hoping that we get these retailers into our market, but actually hunting them,” he said.

Council Member Kyle Smith asked Howland for projections on when the position could end up paying for itself, showing a return on the investment.

The council also supported creating a recruiter position within Human Resources. The idea is department heads would spend less time sifting through resumes and doing the paperwork associated with hiring people, Chief of Staff Don Marr said. Part of the recruiter’s mission also would be to seek out a more diverse workforce.

“To be honest with you, I think we need to be a little more diverse than what we are. I’ll just put that out there,” Mayor Lioneld Jordan said. “I think the recruiter is going to help us with that.”

Another position will be created for a city purchasing agent, with three new parttime positions for parks program assistants.

The council also agreed to allocate $198,000 out of the parking reserve fund to put toward improvements downtown, such as for sidewalks and lighting. Such a measure was included in a mobility study the council adopted in

The $48.1 million general fund, which accounts for nearly 30 percent of the overall budget, has a projected deficit of $846,000.

spring.

Council members also discussed the possibility of shifting around the $250,000 the Walton Arts Center receives from the city every year out of the parking fund. They agreed to change the name of the fund, but will discuss functional options next year.

City leaders don’t know what a possible daily jail fee imposed by the county might have on the budget. The city already pays a onetime booking fee of $62 for inmates. County leaders discussed the idea earlier this month and are set to take it up again in December. The fee could be implemented Jan. 1.

Becker said the administration would have to assess the impact of a daily jail fee and use the city’s general fund reserve to meet any immediate needs.