flat revenues, rising expenses

Columbia committee grappling with next year’s budget

cleblanc@thestate.comApril 4, 2013 

— Columbia City Council and city staffers are weighing how to pay for millions in sewer system upgrades, multimillion-dollar projects and an employee pay raise while city revenues remain largely flat.

Council members said there are no plans to raise property taxes.

With that limitation in mind, the Finance, Audit and Budget Committee has been slugging through the 2013-2014 budget that is to take effect July 1. The panel is to finalize its plan later this month before sending the budget to the full council in May and June for votes.

The committee, since mid-February, has been examining the budget by categories of revenue and expenditures. Newly hired city manager Teresa Wilson has yet to submit a complete budget package, saying she is working on aspects of it and wants to get more guidance from council.

So far, Wilson and her executive staff have proposed a $125.8 million general fund budget that is $4.8 million, or 4 percent, larger than this year’s.

The general fund budget affects most city residents. Almost half of it – 46 percent – would go toward public safety.

Plans are to increase the police department’s budget, currently running at $30.8 million, by $854,000, or 2.77 percent. Wilson and her team also are looking for ways to meet Mayor Steve Benjamin’s request for a nearly 7 percent increase in the fire department budget.

A down economy and crumbling water and sewer lines are realities that weigh on the budget, council members said.

A $7 million loan that would be repaid by taxpayers is included in the proposed general fund budget. Money from the loan, acquired through a general obligation bond, would be used to buy about 50 vehicles and heavy equipment.

So far, the budget plan would include authorizing $100 million for improvements in the sewer system, 80 percent of which would be borrowed money.

A 2 percent across-the-board pay raise would cost about $1.5 million, city budget officials said.

Wilson said she’s worried about the ongoing costs of new proposals.

“As funds are identified to build or add new programs and functions, funding for properly maintaining those services is often left to the departments to figure out,” she wrote to the committee in a memo.

“This is one of the issues I will be attempting to address in the coming year as we seek efficiencies in our operations, evaluate opportunities to consolidate functions and consider centralization,” Wilson wrote.

She already has eliminated the treasurer’s position but created the position of chief financial officer. Wilson supports creating a city business ombudsman who would seek to make Columbia more business-friendly by accelerating permitting and licensing procedures.

The city’s other large fund comes from its water and sewer systems. An overall 8 percent rate increase that takes effect May 1 will help pay for improvements to the systems. That rate hike would contribute to a 5 percent increase to the budget, raising the total to $128.1 million.

Wilson has proposed the city cut transfers out of its utility fund into the general fund – long a controversial practice in Columbia – by $250,000. That’s a small amount, but it’s a start, Wilson has told the committee. Last week, Benjamin warned that eliminating the entire $4.5 million the city transfers out each year would result in a $55 property tax increase. He has not addressed the option of cutting spending.

As of Thursday’s meeting, the committee has yet to discuss whether it will recommend:

•  A multimillion-dollar loan that would be repaid through meal taxes patrons pay for eating out or drinking prepared beverages. Council has yet to list how large the loan would be or what projects would be funded. But it has voted to borrow up to $7 million to save and refit the Palmetto Compress former cotton warehouse.

•  More services to the homeless, on whom the city now spends about $1 million.

Granting financial help from taxpayers to various groups and organizations. Those requests grow yearly.

•  Changing the city’s ties to the Columbia Empowerment Zone, which seeks to attract development to North Columbia.

•  Higher pay raises for firefighters than for other city workers. Firefighters complain they are vastly underpaid and are bleeding employees to better-paid fire departments. That jeopardizes fire safety, they have said.

In a proposal that appeared to catch the committee by surprise, the city clerk’s office is seeking $120,000 to manage Columbia’s first autumn election.

In order to avoid last November’s countywide Election Day mess, the city wants more voting machines and equipment and more polling places.

Normally, the city sets aside $60,000 for elections, which last year were moved from April.

Big-ticket breakdown

Here are the major components of a committee’s proposals for the 2013-2014 Columbia city budget:

Water and sewer fund

$128.1 million, up 5 percent

General fund

$125.8 million, up 4 percent

Police department

$31.6 million, up 3 percent

Fire department

$20.5 million, up 5 percent

SOURCE: Columbia’s budget and finance offices

Staff writer Mindy Lucas contributed to this article. Reach LeBlanc at (803) 771-8664.

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