The good news is Fairhope finally has a fiscal year 2017-18 budget. But it comes with bad news.
“Without a 1.5 percent across-the-board utility hike the budget numbers will not work,” Council President Jack Burrell said. “There were numbers that were presented to us initially and Councilman [Robert] Brown and I settled on 1.5 percent across the board. It was the only thing we felt comfortable with.”
Burrell said the increase can’t be counted on immediately, however.
“That revenue can’t be attained now because we cannot put that in the budget,” he said. “It has to be done via ordinance. We don’t have ordinances drafted for the four utilities.”
Burrell dispatched Brown to further study the increases and come up with a proposal for the increases to help balance the budget.
“What I’m going to do is ask Councilman Brown to go out between now and the next meeting and come up with a number,” Burrell said. “It may not land on 1.5 percent, it may be different numbers for different utilities.”
During work and regular sessions, Burrell and Brown went through highlights of the budget, which eventually passed unanimously about an hour and a half into the regular session. Mayor Karin Wilson, who had been sparring with council members since she presented a budget in September, didn’t comment on the measure.
Budget discussions began in September and the fiscal year started on Oct. 1. The city continued to operate on the 2016-17 budget while the new one was being developed. Fairhope didn’t pass that budget until May 1, 2017, or eight months after the start of the fiscal year.
Brown said the city is projecting revenues of about $26.8 million, with expenses at about $26.1 million.
“The initial budget for general government expense was $26.5 million, so we reduced that by $400,000 which in the scheme of things is not a lot,” Brown said.
“However, going through each department and looking at capital purchases as well as additional personnel, we felt like we’re getting better products through capital purchases looking at lease versus purchase.”
Included in the budget is a .5 percent item to be used for reducing debt in the upcoming fiscal year, Brown said.
“Jack wanted to make sure that the debt reduction, the half of a percent, was put back in as the ordinance stated and it doesn’t go into the general fund as we allowed last year,” Brown said. “Although we increased the appropriations and transfers, that includes the money set aside for debt.”
But Burrell said that doesn’t mean the city can use the money if situations arise where capital funding is needed.
“If something comes up that is necessary I’ll be flexible on that,” Burrell said. “We can say we can turn it over to the general fund if something comes up.”
Also during the sessions, the council and others discussed the city giving a one-acre retention pond in the Fig Avenue area to the Fairhope Single Tax Corporation.
On the Tatumville land, the Single Tax nonprofit owns land near the one-acre detention pond and wants to develop 12 lots there. Representatives said any profit from the development would be spent on improvements in the city as required by their nonprofit status.
Wilson presented a letter from a 2003 study that said the property was and will always be unbuildable.
“Does the Fairhope Single Tax Corporation acting as a developer open up the possibility of other developers asking for the same treatment?” Wilson asked. “This is our most sensitive gully system.”
The council considered asking for unanimous consent to immediately consider the land transfer, but since Councilman Kevin Boone is part of the Single Tax group, his abstention wouldn’t allow that. The move will be considered at the next council meeting.