Budget puzzler of the year: How can Payson adopt a $56-million budget that’s 56 percent higher than this year and still be darn near broke?
Hint: We’re talking government budgets here — which resemble regular budgets like a duck resembles a platypus.
After months of figuring, marathon study sessions, an epic recession, layoffs, pay freezes and assorted legislative antics — the Payson Town Council this week held yet another hearing on the proposed budget for 2009-10.
But despite hundreds of pages of budget detail, it amounts to a detailed, high-stakes, what-the-heck guess — thanks to the perils of predicting the end of the recession, the impossibility of predicting the legislature and a law that won’t let the town spend any more all year than it budgets in June — no matter how many grants it snags.
Grants, federal dollars boost budget
That explains why the town’s proposed budget will likely jump from this year’s $36 million to a whopping $56 million — thanks largely to the inclusion of millions of dollars in state and federal grants the town had applied for but may not actually get. All told, the budget includes about $21 million in grants — half of them still speculative.
The $25.7 million operating fund budget for all the town’s activities actually provides a better measure of spending trends — up about 5 percent from this year’s total.
The budget for town operations skimps on road maintenance for another year and minimizes raises and new hires, with a few hard-case exceptions. The budget also edges away from the current hiring freeze, to add a financial officer and two firefighters — providing the town lands a hoped-for grant.
The number of town employees will rise by four to 174. That compares to 160 in 2003 and 165 in 2007. The number of town employees per 1,000 residents will have risen from 9.5 in 2005 to 11.4 in the coming year.
That operating budget features a $500,000 loan from the town’s water department to produce a wafer-thin $571,000 ending balance —about 2 percent of the operating budget.
The state legislature continues to thrash about in the mud bog of next year’s state budget like a dying crocodile. One rumor suggests the legislature may gobble up the $5 million Payson has set aside in water impact fees to build the Blue Ridge pipeline. Another proposal could stick the town with $100,000 in charges for using the state crime lab. Another idea floated could deny the town an estimated $135,000 in impact fees.
Yet another proposal would cost the town $15,000 in expected state gas taxes. All or none of those changes could take place by the time the legislature fills in a projected $3.6-billion deficit.
“Nobody really knows what the numbers are,” said Town Manager Debra Galbraith.
Unfortunately, the state legislature has required cities and towns to adopt a spending ceiling before the legislature itself is likely to tell the locals how much money they’ll have.
As a result, the town’s budget discussions remain frustratingly hypothetical.
So it’s hard to tell how things will turn out.
Could be, the town will end up with a new animal shelter, a third fire station, better police communications, one-third of the Blue Ridge pipeline, major additions to the airport, a spiffy new roundabout at Beeline Highway and Airport Road, a full range of recreation activities and a larger town staff.
On the other hand, if the recession deepens instead of eases and the legislature takes another big bite out of town revenues, all the planning may be a mere prelude to a fresh round of layoffs and service cuts.
The budget assumes additional gains and losses in revenue — mostly a drop in state funding and sales tax, offset by a huge increase in federal grants. Assumed changes included:
• A $715,000 drop in state shared revenue.
• A $180,000 drop in even this year’s modest sales tax receipts.
• A $234,000 drop in money from intergovernmental agreements.
• A $19 million increase in grants — including the $11 million grant for work on the Blue Ridge pipeline.
• A $40,000 increase in impact fees, thanks to two anticipated housing developments.
• A $600,000 loan, mostly a transfer from the water department to the general fund.
Many of the economy measures imposed in January will continue. For instance, most employees will go another year without raises — a savings of $200,000.
The town hall will remain closed on Fridays, town employees will continue to do all the janitorial work, street workers will maintain the parks instead of outside contractors and most of the current vacancies will remain unfilled — including four in the police department and three in public works. The fire department will do without money to pay five firefighters to remain on-call in case of emergencies and without a fire prevention specialist, who would have mostly worked to convince property owners to thin overgrown lots. The town will also save $65,000 by continuing to not pay workers for unused sick leave.