Germantown to wait on COVID-19 to do budget
The Germantown Board of Mayor and Aldermen adopted a continuing resolution extending the current fiscal year budget into the next fiscal year as city officials wait to see the full extent of the economic devastation caused by the COVID-19 pandemic.
Board members passed the resolution in a 4-0 vote during a virtual meeting Monday night. Alderman Dean Massey abstained from voting.
City Administrator Patrick Lawton said that the city did not yet have a clear enough picture of the impact the “Safer at Home” policies have had on sales tax revenue. The policies largely kept residents indoors and businesses doing minimal — if any — business over the past six weeks.
The city will not receive April sales tax figures from the state until June. The new fiscal year begins July 1.
“There is nothing more I'd rather do this evening than present to you the (fiscal year 2021) budget,” he said. “Unfortunately, however, the situation we find ourselves in does not allow me to do so at this time because of the devastating impact of this pandemic.”
While property tax collection, which makes up the largest chunk of the city's tax revenue, will remain steady, sales tax, hotel and motel occupancy tax and other levies have likely declined drastically since county-wide shelter-in-place orders took effect on March 26.
Lawton said that with the economic uncertainty the pandemic has wrought, it was impossible to accurately forecast what the revenue flowing into the city would look like in the near future.
The city's finance committee is expected to review budget proposals in June and July and Lawton said he hopes to have a budget he can present to the board in 90 days. However, no date is set in stone.
Once a budget is adopted, three readings, including a public hearing, are required before it can be passed — a process that would take about six weeks, given the board's meeting schedule.