Fairhope Mayor Tim Kant introduced a proposed $62,519,304 budget, including $57,872,241 in total expenditures, for the 2015-16 fiscal year on Monday evening. The proposed budget is $1.4 million more than the previous year.
The budget includes a surplus of $4,467,063 and a 2 percent cost-of-living raise for city employees. The city will hold another budget meeting Oct. 8 at 4 p.m., and expects to approve the budget in October.
Kant said the $1.3 million the city received from its BP settlement was put into the city’s capital fund, where it can then be moved to an appropriate fund when the city decides how it wants to use the money.
The mayor expects the city’s utility revenues to be approximately $300,000 lower than the previous year, with $38,428,904 in revenues from the gas, electric, water and sewer funds. The largest of those, $20,413,225 in the electric fund, is down $500,000 from last year’s expectation.
The city projects utilities expenses at $30,440,745 this year, with the bulk coming from $17,137,668 in electric fund expenses. The city will also make $3,417,969 in utilities transfers to the general fund this year, for net earnings of $4,570,190, down more than $2 million from last year’s projection.
The budget projects $27,508,369 in general fund incomes, which includes the $3.4 million transfer from the utilities funds. It projects General Fund expenditures to reach $23,381,496, giving it a net income of $4,126,873.
Kant said the city projects sales tax revenues of $6.9 million, with $2 million for debt reduction on the city’s $26 million overall debt.
The budget reflects $4,780,000 in property tax revenues and $8,190,100 in local taxes, which include the sales tax, beer, wine and liquor taxes, cigarette tax, dog tag tax and the lodging tax. It will collect $3,144,500 in license and permit fees and $1,121,000 from the golf department.
The city expects to collect $48,000 from its municipal harbor lease agreement with Eastern Shore Marine. In August, the city provided Revenue Department figures to Lagniappe showing Eastern Shore Marine paid $32,676.81 in the 2014 fiscal year and in 2013 $25,776.73 for its leases at the marina.
For general administrative expenses, the mayor expects the city to spend spend $8,028,893 this year. The mayor’s $30,000 salary and $37,200 in total salary for councilmembers remain the same, and the city will spend $1,259,187 in administrative salaries. Kant also receives $2,307.69 per pay period as utilities supervisor, which amounts to approximately $60,000 annually.
“Our salaries are up, but that includes some new employees,” City Council President Jack Burrell said. “That doesn’t mean we are just throwing out raises to everyone. As we grow as a city, we have to spend more to pay more people to manage that growth.”
The city’s overall employee medical insurance costs went down from $2.6 million last year to $1.9 this year, but its medical costs for retired employees nearly doubled to $414,000.
The city will pay $12,500 in rents for buildings on Fairhope Single Tax Colony properties (see this week’s cover story for more information).
The Fairhope Police Department will have $4,881,703 in expenses. The department will pay more in salaries at $3,237,842, and see a doubling of its expenses for training and travel to $30,000.
The Recreation Department will see an additional $200,000 in expenditures this year, mostly related to the new Manley Road soccer complex. The department’s budget for vehicles is $117,990, up from $66,000 the previous year because of additional equipment costs at the soccer complex. It also budgeted $920,398 for salaries, which will include at least two more employees for maintenance at the complex, up from $805,980 in the previous budget. The figures provided at the city’s budget hearing showed the city has spent $742,000 in recreation department salaries this year.
The city’s utilities are projected to have $2,883,566 in expenditures on capital projects. The electric department will account for $761,000 of those expenses, with $300,000 for lighting infrastructure at the new soccer complex. That expense is on top of an additional $1 million for the purchase of the lighting system for the complex.
The water and sewer department expects $1,105,333 in expenditures, which include $400,000 in sewer line upgrades, $250,000 for repairs to meters and lines and $150,000 for manhole rehabs.
For capital expenditures, the mayor’s budget proposes $4.8 million in General Fund and utilities capital expenses. The Information Technology (IT) department has asked for $397,821 in expenses with spending for laptops, radios, consoles and an updated GPS for the Fairhope Police Department. It also includes $5,000 to purchase tablets for City Councilors.
Along with its IT requests, the police department is also seeking $311,900, including $217,000 for five new vehicles and $33,900 for bullet proof vests, tasers, flashlights and intoxication meters.
Fairhope’s public works department is requesting $645,200 in expenses, including $220,000 for a garbage truck and $168,000 for the purchase of 4,000 cans for the implementation of a single-source recycling program. Burrell said he was not sure about making a $168,000 expenditure for the program.
The city’s capital projects fund balance beginning Oct. 1 was projected at $5,832,152, with an ending balance Sept. 30, 2016, of $2,890,017. Burrell suggested the city use the leftover money for any number of projects.
The budget lists citywide street resurfacing, golf paths, parking lots downtown, street repairs at Founders Park and repairs at Majors Field as possible capital projects. The council also discussed repairs at the public beach park.
“I’m not saying we should zero it out,” Burrell said. “But I think we owe it to the citizens to put this money out there and use it to improve some areas that need work.”