An increase of $2 million for adjusting Lee’s Summit employees’ pay is planned for the next fiscal year under a budget proposed by City Manager Steve Arbo.
Arbo presented his proposed 2017-18 budget last week to the City Council’s Finance and Budget Committee, which will hold discussions on it this month. A public hearing and vote by the full council will take place before the budget goes into effect in July.
Arbo said the city has a compensation-and-pay study underway on whether the city is competitive with other municipalities. Results of the study may recommend adjustments so employees within the city departments with similar responsibility have equitable pay. He expects the study to be completed so that the adjustments can be implemented in the fiscal year.
He said the city also has included $1.2 million in pay increases for the firefighters under an agreement with that union.
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He said the city is on solid financial ground. It uses a computer model to project revenues and expenses for a future five-year period, and for the first time in many budget cycles, the city doesn’t show any deficit funding in the third to fifth years, even building in the pay increases and increases for health-care costs.
“They appear to be relatively sustainable,” Arbo said.
Arbo said in the past the city has managed through projected deficits by belt-tightening.
The city’s general fund, which generally pays for salaries and other day-to-day functions like fire and police, is to be nearly $68 million. The total $208 million budget includes debt service on various bonds and the enterprise funds that also include the municipal airport and water utilities.
The city also has about 40 percent of the total general fund as a reserve balance, Arbo said.
Councilwoman Diane Seif asked him to explain why it is important to have that level in reserves.
Arbo said it is valuable in keeping the city’s bond ratings high, so that it pays lower interest rates when borrowing money, and as a hedge against unforeseen problems or a recession.
For example, he said, the city has been struck by a tornado twice in the last three years, although damage was limited.
“We could have had a bridge wiped out,” Arbo said. “We could have a shopping center wiped out, which would have been a revenue source for us.”
Jack Feldman, management analyst for the city, said that sales tax growth has been strong.
“It has been growing at a fast pace for the last four or five years,” Feldman said.
While recently the sales tax receipts had grown by 7 percent, the city is conservatively budgeting 3 percent growth for the coming fiscal year. Property taxes also are growing, but utility taxes are declining as technology shifts and laws that affect taxes collected from cable television and telephone companies are changing.
With ongoing improvements at Lee’s Summit Municipal Airport and other projects, spending from the city’s Capital Improvements funds jumps from nearly $46 million this year to slightly more than $59 million in the coming year.
Arbo said one of the things he’s most proud of is that the Council and staff have developed strategic planning for key areas such as public safety to decide priorities for the budget.
Initiatives in those areas for the year include:
• A major, $8.5 million upgrade of the emergency services radio system to make it compatible with other cities in Kansas City area. Lee’s Summit would be part of the Metropolitan Area Regional Radio System.
• Adding a police officer to work with the Drug Enforcement Agency in its High Intensity Drug Trafficking Area program; the police department is also making a part-time detention officer position full time
• Adding a fire captain to focus on training within the fire department.
• Three interns working with the Missouri Innovation Campus to work in Public Works, Development Services and Information Technology.
• Hiring an cultural arts manager.
• Adding an engineer to Public Works and another engineer to the Water Utility departments.
• Recodification of the city’s Unified Development Ordinance to update and streamline it and make it more useable for staff and developers. Adopted in 2001, it’s had more than 60 amendments.
“It’s looking a little messy and disjointed,” Arbo said.