Memorandum 18-092 2019 Budget Priorities

Memorandum 18-092

TO:                        Mayor Zak and Homer City Council

FROM:                 Katie Koester, Homer City Manager 

DATE:                   August 8, 2018

SUBJECT:          2019 Budget Priorities

The purpose of this memo is to stimulate Council discussion on Budget Priorities for the 2019 proposed budget. According to the budget schedule adopted by Council, the first meeting in August the City Council directs the Manager on budget priorities for the following year during Committee of the Whole and the public provides direction under Public Hearing. Some of the things I am thinking about as I work on the 2019 draft budget include:

New police station coming online:

The 2019 draft budget needs to take into consideration the fact that the City will be brining on the new police station by late fall. This means we will need to be prepared with increased demands on building maintenance and janitorial services. I also would like to have some idea of what we are doing with the old police station to limit the time we are supporting the operational expense of the old facility (see City Manager report for more discussion on next steps).

First year without the suspension of Homer Accelerated Roads and Trails (HART):

2019 will be the first budget year in 3 years that the City of Homer has approximately 60% of the Homer Accelerated Roads and Trails dollars to offset general fund dollars through the maintenance of roads and trails instead of the full 100%. The remaining 40%, or $550,000, is dedicated to replenishing HART for capital improvement projects. Council has been prudent in their spending and spent the last few years building reserves to prepare for this, nevertheless the City will be contributing less to reserves in 2019 than in previous years.

Tight budget fatigue:

I know my staff is tired of hearing no and years of living on tight operating budgets is taking their toll. I don’t have a single department that has not expressed some need for staffing. The inevitable life emergencies that take employees out of work for long periods of time leaves the rest of the department scrambling and just getting by to cover, which means important long term projects get pushed to the side, overtime hours rack up, and staff get burnt out. Homer is busy and with that comes increased demand for services, whether it be signs, trails, parks, speeding tickets or public meetings and task forces. It all adds up. And I know you are all feeling the pressure too as constituents ask for more thoughtful (and time consuming) brush cutting, more recreational services, and a greater police presence in certain neighborhoods. There is reason to be hopeful though; both property taxes and sales taxes have remained stable. I am hopeful that after a couple years of living with the new HART structure and figuring out some of the unknowns on the horizon (like the state budget and what the City will do with the HERC) will help with uncertainly and allow the Council to plan for the future.