Wednesday, February 13, 2008

KY3 Reports Springfield Faces Major Budget Crisis

KY3 News reported this evening the city faces a major budget crisis due to lower than expected sales tax revenue. KY3 reports Springfield City Manager Bob Cumley has instructed department heads to cut their budgets 5% because of the decline in revenue. The budget shortfall occurred when the city leaders approved a budget based on a sales tax growth of 3%. Sales tax revenue is down 1% from last year. That spread of 4% means about $3,000,000.00 less for the city.

Additionally, the city has been directed by the Missouri legislature to put more money in the police and fire pension fund or risk losing 25% of the tax revenue the city receives from the state.

KY3's Paula Morehouse's report is here.

Did the City Council know about this budget shortfall before Monday's City Council Meeting? Those in attendance tell us there was no public discussion of a budget shortfall at the meeting.

Meanwhile, the Heer's developer has the city held hostage over the Heer's building. He writes " light of all of the changes to date and now the Square matter, perhaps we both may want to sit down and discuss amending our agreement if the Council decides more time is needed to settle this matter." The City Council on Tuesday approved the redesign of the square. Councilman Chiles was the sole "no" vote. The first phase will cost about $870,000 to build, but a master plan view of the square would raise the price tag to $2.97 million. As near as I can cypher, $1 million of the cost would be covered by earmarked federal funds, the city would be responsible for the rest.

As I see it, our tax money is going to benefit his project while city departments are asked to cut 5%. It just don't seem right.

Someone knew that revenue was declining. Unless they were all asleep at the wheel, someone in the city HAD to know that the money wasn't coming in as budgeted.

I keep remembering how during last few city council meetings Councilman Manley kept pushing to hurry up and vote on spending money. "Time is of essence," he would say. Did he know something? Or was someone on staff using Manley to push these projects though; knowing, but not telling him, of the projected budget crisis?

From LifeOfJason liveblogs of City Council meetings:

Councilman Manley said they need to do what they have to do to keep Mr. McGowan there on the square. He urged Council to adopt this resolution now so they can move on this “with due haste.”

Sale of property involving the Arena Site deal. Councilman Manley wanted to amend by adding in section 3 a passage on declaring an emergency due to tax service. John Q. Hammons’ operating control of the Expo center in increased by 20 years and there are four 5-year options.

Councilman Manley said that the people in these departments are experts in their fields and that the Council needs to rely on these people. He said that they’ve had this to review for a week or so and that it’s ready to pass because the experts said it’s important. He said he wants to vote on it tonight and passing this tonight. He said that this is what the people want and that it should be passed
If the knowledge that a budget crisis was developing made known to City Council, would they have made other decisions on the issues presented to them? Like selling that arena property for a loss of $7,000,000.00?

City Council members: When did you learn of this budget shortfall? Is KY3's report accurate? A better question might be: were you ever made aware that there might be a budget shortfall? If so, when?

Should the audit have picked up on this budget shortfall?

A news story in the February 6 edition of the SN-L has the headline: Revenues up 4.9 percent over 2007, state official reports. If the city is a sub-set of the state, and state revenue is up 4.9%....what ain't I seeing? Am I missing something here?

BTW, I applied for that City Academy.

1 comment:

Anonymous said...

There is a gnawing sense, at least in my perception, that things are spinning out of control in city government. And nobody is giving us the big picture.