On paper, Payson’s preliminary budget for fiscal 2014-15 will jump an eye-popping 30 percent, driven by a projected 39 percent rise in revenues.
The Payson Town Council last week took one more step toward adopting the least financially stressed budget in four years, with enough money for a 3 percent merit raise and $200,000 in extra pay for overtime and paid time off worked in the past few years.
The council gave preliminary approval to a $41 million budget for fiscal 2014-15, which includes the general fund, the water department, payment on debts, various special districts, grants the town may not actually get and a host of other specialized funds.
The overall budget would increase from $32 million this year to $41 million in fiscal 2014-15. However, much of that increase comes from an $11 million jump in water department spending related to the Blue Ridge pipeline and more than $1 million in federal grants to expand the airport runways.
Even with that huge, on-paper jump, the adopted budget would be just barely above the 2012-13 budget and far below the $84 million budget adopted in 2010-11.
The total operations budget would increase just 2 percent to $22.6 million. The capital budget will jump 116 percent, driven by the Blue Ridge pipeline costs. Total water department capital costs should hit $13.6 million. The town’s debt payments will jump 13 percent, again driven by the pipeline.
Town workers will get a 3 percent merit raise. They’ll also get back pay for overtime and paid time off they’ve worked in the past couple of years, but which the town deferred during the budget crunch. The $200,000 payment will cover only about half the cost of the accumulated extra time.
The budget also includes money to add an economic development director, a code enforcement position, a secretary for the police department, promotions in a handful of departments and several new part-time positions in the water department.
The budget also envisions splitting the community development into two departments — one for building and one for planning and economic development. The town hasn’t had an economic development director since former Councilman Mike Vogel moved away from Payson for health reasons.
Nearly every town department expects a substantial budget increase, including:
• Police: up 18 percent to $5.2 million.
• Fire: up 9 percent to $3.5 million.
• Council: Up 23 percent to $107,000.
• Attorney: up 26 percent to $408,000.
• Streets: Up 22 percent to $2.8 million.
• Community development: Up 56 percent to $1.1 million.
• Water: Up 64 percent to $18 million, including $12.5 million for the Blue Ridge pipeline.
• Recreation and Tourism: Up 31 percent to $762,000.
• Airport: Up 400 percent to $1.3 million, including $1 million in federal grants to improve runways.
• The Central Services budget for employee benefits would go up 10 percent to $3 million.
• Human Resources: Up 11 percent to $227,000.
A projected 40 percent increase in revenues would cover the big budget hikes. A big chunk of both the spending and the revenue increases comes from the need to include hoped-for grants so the town will have the spending authority to actually spend the money if it comes in.
In years past that padded the seeming bottom line by millions of dollars never either received nor spent.
The optimistic projection of $38 million in total revenues may look like a huge jump from this year’s $27 million — but it’s still a far cry from the $65 million received in 2010-11.
The budget includes $1.4 million in reserves, less than the 5 percent called for by town policies — but substantially more than this year. Even so, the reserves represent only about three weeks worth of operating costs for the town.
The budget also includes some big increases for things the town can’t control. For instance, after a rash of disability cases involving employees — including police officers — the town’s workman’s compensation costs will jump by 20 percent.
The town will also have to increase the contributions into the Public Safety Retirement fund for police from 41 percent of salary to 42 percent of salary. That means that for an officer making $50,000, the town has to pay another $21,000 into the state retirement system for police officers. That doesn’t count the cost of health care and other benefits.
The town’s property tax rate will rise slightly, thanks mostly to a continuing decline in townwide assessed values. The assessed value of the town will drop from $165 million to $162 million. However, to boost the amount of money coming in through the town’s property tax levee by about $10,000 to a total of $642,000, the rate will rise from .3862 per $100 of assessed value to about .3963 per $100.
The town council won’t officially adopt the proposed budget until June 19, when the council will also hold a hearing on the proposal to increase the property tax levy.