With revenues up and expenses down in the first six months of the fiscal year, leaders with the city of Athens painted a positive financial picture Monday.
Annette Barnes, finance director for the city, told Mayor Ronnie Marks and members of the City Council during a work session that the city’s general fund revenues versus budget at the halfway mark of March 31 represented a difference of roughly $480,000 to the positive.
The city’s total revenues through six months were $12.5 million, though the budget over the same period was $11.9 million. Projected annual revenue is estimated to be $23.2 million.
Barnes attributed the gains to a strengthening economy, as $356,000 of the $480,000 is in sales taxes. Of that amount, however, $178,000 will go to Athens City Schools.
Property taxes are also up about $17,000, an increase of $13,000 over the same period last year. Like sales taxes, half the city’s ad valorem taxes benefit local schools.
Barnes said the city’s lodging tax of $1 per room, per night, brought in an additional $26,000 more than the same period last year. The fee went into effect in January 2011.
Council President Jimmy Gill said he asked one hotel manager if anyone had complained about the lodging tax, but received a surprising answer.
“She said the only person complaining were the people who live here,” he said. “I don’t know why because they’re at home anyway.”
The only negative tax revenue that was less was the city’s cigarette tax, down about $15,000 over the same period last year, meaning fewer people are buying cigarettes. She said the city’s alcohol tax revenue is up, however, about 2 percent over last year.
Marks said despite the positive news, city leaders are concerned about how Athens and the school system will be affected by changes in how TVA-in-lieu-of-tax money is distributed. The way the bill is currently structured in the Alabama Legislature, about $78,000 could be cut from the school system this year and $148,000 next year, he said.
The TVA-in-lieu-of-tax funds is partially represented in the “intergovernmental” category of the city’s budget, which was $48,000 below budget at midyear. The city receives $138,000 per month and the amount is reconciled at the end of each fiscal year.
“We have no control over the TVA dollar figure, and we’ve budgeted the best way we can,” Marks said. “We hope that it will start coming back up.”
The city is currently running more than $112,000 over budget in terms of business licenses and building permits, a fact Barnes attributed to construction following the April 27 tornadoes. Of that, about $13,000 was just for construction permits.
Barnes said a negative variance of about $55,000 in the city’s court system might be owed, in part, to fewer people being charged with driving under the influence. She said the first $600 in fines related to a driver’s first DUI offense goes to the city, and there were about 30 fewer DUI offenses in the first six months of the fiscal year compared to last year.
She said there were also fewer citations written, a fact she said could be attributed to the police department spending more time patrolling neighborhoods in an effort to keep gasoline costs down.
“I like officers riding through the neighborhoods because it builds a good quality of life for all of us,” Marks said. “We’ll adjust dollar amount-wise, but I don’t want to adjust being in the community.”
The city’s recreation department revenue is up more than $18,000 over budget and the cemetery department is up more than $9,000 over budget. Ben Wiley, superintendent of the cemetery and recreation departments, attributed the recreation increases to the addition of girls softball and increased numbers of kids signing up to play soccer and indoor volleyball.
The city’s sanitation department is a little more than $83,000 ahead of budget, which Sanitation Director Earl Glaze attributed to scheduled rate increases built in through 2015.
The city also noted a gain of about $19,698 for the sale of scrap metal used in the old City Hall, which has been demolished. The city used the funds to purchase a new truck for the Public Works department.
Barnes said the city is about 46 percent below budget in terms of expenses at the mid-year mark. Total expenditures through six months were budgeted for $11.3 million, while actual expenditures were $10.8 million. The city’s annual expenses are projected to be $23.4 million.
Despite a move by the city to increase health insurance premiums 12 percent, there was a reduction of about $129,000 in net health care costs. She said the city can get money back from Blue Cross and Blue Shield based on actual insurance claims.
She said the city is also in line with its gasoline expenditures, which officials budgeted at $3.50 per gallon. Athens uses the Fuel Management system, which saves about 20 to 25 cents at the pump.
The average price of gasoline through March was about $3.21 per gallon, though the average March price was $3.49 per gallon.
“We did use 52 percent of our total gallons in the last six months, but we were under budget $20,000 on fuel in all departments,” she said.
Athens outpaced its appropriations and transfers out amount by about $264,000 over the first six months with $3.1 million spent and $2.85 million budgeted. The city budgeted about $6.7 million for the year, though that amount includes about $4.1 million in tax revenue to the school system, $400,000 for street light repairs and $1 million in appropriations to agencies.
Other amounts in the category include $100,000 for the new library project and $96,000 in lodging tax funds for the local tourism agency. The remaining funds are debt service payments.
City leaders said appropriations during the next budget cycle would be examined more closely to ensure agencies had appropriate documentation, an annual budget and that no services were being duplicated
“If they have a problem producing a budget, we’re not going to appropriate money,” Marks said.