Northwest Arkansas Democrat-Gazette
City weighs shifting budget to CARES
Administrator recommends moving 2021 needs to $3.4M expected funding
FORT SMITH — City Administrator Carl Geffken recommended last week shifting much of the general fund’s new needs for 2021 to the more than $3.4 million expected in Coronavirus Aid, Relief, and Economic Security Act.
The Fort Smith Board of Directors discussed new needs requests for the proposed 2021 city budget during a special study session on Tuesday. The issue, which had been deferred from a budget hearing the board held on Nov. 6, will be discussed again at the board’s next study session, which is Tuesday.
Geffken laid out his recommendations in an email to the board.
The city administrator also provided the board with a proposed spending plan for the CARES Act funding. Of the more than $3.4 million, $463,740 would cover the general fund portion of the capital new needs for 2021, and $1.5 million would go toward a new CAD/RMS system for the police and fire departments.
Another $1.5 million would be invested into a three-year agreement with Tyler Technologies to transfer the city’s Munis system to the cloud, Geffken said. That would result in the city saving $400,000 per year during the three-year period, with $148,000 of this amount being saved in the general fund operating budget.
Geffken said $ 421,651 in CARES Act funds would also be spent on new dispatch supervisor positions in the Fort Smith Police Department, as well as new Parks and Recreation Department positions, for 2021. That would leave a “CARES Act deficit” of $321,985 in the general fund, according to the proposed spending plan.
“I thought using the CARES Act funds for these purposes would get us over the COVID period where we’re conservatively estimating revenues,” Geffken wrote in his email.
The only change in expenses in the general fund not covered by the CARES Act funding, according to the 2021 budget recommendation, is an allocation of $110,039 to go toward merit increases for non uniform city employees. A total of $453,686 was recommended for this, with the rest of the monies to come from other funds.
Geffken said the increases would go into effect April 1.
“The allocation for the merit increases is 1.5% of each department’s salary budget,” Geffken explained in his email. “Each department head will be able to provide an increase to each employee between 0% and 3%, based on their evaluation. The increases will be reviewed by HR [Human Resources], Jeff [Dingman, Fort Smith Deputy City Administrator], and me.”
An updated budget comparison summary provided by Geffken, which does not take the new need recommendations into account, shows a projected total deficit of $928,313 for the 2021 fiscal year over four city operating funds. These include the general fund, streets maintenance operating fund, water and sewer operating fund and solid waste operating fund.
The proposed capital needs and initiatives, personnel requests and non uniform merit increase amount to a total expense change of more than $3.8 million, increasing the projected deficit for 2021 to almost $4.8 million, according to the recommendation.
“… To help offset the deficit is the franchise fee that has been discussed about for private solid waste haulers, and an increase in the supplemental alcohol tax [from 5% to 10%],” Geffken said.
The recommendation states that the franchise fee and increase in the alcohol tax would bring in $600,000 in new revenue to the general fund. This would lower the projected 2021 deficit to almost $4.2 million.
A surplus of more than $5.7 million is estimated for the 2020 fiscal year over the city’s four operating funds, according to the budget comparison summary. Geffken said this amount does not include the CARES Act funding the city expects to receive.
The board study session is scheduled to begin at 6 p.m. and will be held at the Fort Smith Convention Center, 55 South 7th St., Exhibit Hall B.
The meeting will be shown at: https://ibm.co/2VAGZYe.
The agenda is available at: https://bit.ly/2JyhkNq.