Sept. 21, 2010
Huntington Finishes Fiscal Year with Shortfall
Don’t Count on Occupation Tax Revenue For Now, Williams Suggests
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) - A negative carryover from fiscal 09-10 has placed Huntington’s finances on the edge of a red precipice, leading to a request of at least a two percent budget cut. The Finance Committee at Monday afternoon’s session learned of a budget revision that would leave only $38,545 in the city’s contingency fund.
“The [final] revenue [for fiscal 2009-2010] came in much, much less than predicted,” Finance Committee chairman Steve Williams said. The Budget Revision Request shows a shortfall of about $240,000. In Early September, the Wolfe Administration gave a preliminary expectation of having a $100,000 carry over in the general fund.
Williams said that the liability insurance savings of approximately $500,000 per year , which was approved at the Sept. 13 meeting beginning in fiscal 2010-2011, prevented the city from slipping into the red.
Council chairman James Insco called it “unrealistic” to proceed with the proposed $38,545 contingency, explaining that “does not anticipate unexpected expenses.”
Theoretically, those expenses could already be in excess of revenue. Runyon does not yet have a year to date for the expense column.
In fact, the Finance Committee agenda had the purchase consideration of both an asphalt compactor and a refuse compactor. After hearing that the city has been using a borrowed asphalt roller from the state, several appeared ready to recommend the lease purchase financed through street department funds.
However, Insco suggested to Williams that the budgetary updates be moved forward on the agenda. Councilman Nate Randolph acceded, too, that the number crunching come before a decision on equipment leasing or purchases.
REVENUES NEUTRAL
Although the first quarter of 2010-2011 still has two weeks remaining, revenues are in the words of Finance Director Deron Runyon “neutral.” At this time last year, “we were already behind,” Runyon said, adding that he not ready “to take a victory lap,” with many current revenue items a percentage point or two ahead or lagging.
For instance, the City Service Fee (User Fee) , which is dependent upon employees working in the city has generated about $950,000. By comparison at this time last year, $1.1 million had been collected.
Mayor Kim Wolfe told council that the city has already placed a freeze on non-essential spending and hiring. Wolfe hinted that public works has been sliced “to bare bones” so council may want to reconsider the police and fire department budgets, which were exempt from prior cuts.
HOME RULE REVISION IN COUNCIL VOTER JEOPARDY?
Councilman Jim Ritter told the committee , “I’m not very happy right now,” after reviewing the preliminary financial data. But Ritter’s ire also centered on the previously announced Memorandum of Understanding with the Police Department.
Threatening to switch his vote on the revised Home Rule Plan, Ritter disagreed with the administration’s decision to grant employees a legal holiday for the Saturday special U.S. Senate primary election.
Wolfe stated, “We didn’t have an option; it’s state law.”
City Attorney Scott McClure opined, “You get time off or time and a half pay.”
Insco qualified the answer stating only those employees under civil service would qualify.
Williams believed the Mayor should have checked with other cities in the state before granting the holiday.
Ritter quipped, “I don’t care if [the revised home rule plan] passes or not and Mr. Houck said I can speak for him too.” Both now appear concerned about the administration having too much discretion over receipts that would go into the general fund.
If other votes stand the same and Ritter and Houck vote "no" on the revised plan, it would fail by a 6-5 margin.
POLICE AND FIRE NOW NOT IMMUNE?
After the meeting, Williams explained, that he believes the sense of the finance committee now will “ask the administration for substantial cuts.” He said that Insco wants the contingency replenished to the original $600,000. Williams would prefer a contingency between $750,000 and $1 million. Insco’s preference would mean the 2% cut and William’s preference would mean a 2.6% cut.
“The Mayor is reminding us that [council] voted not to cut police and fire. Read into it what you want, but I think if we are going to cut, we will have to go into the police and fire departments [with budget cuts].”
DON’T COUNT ON OCCUPATION TAX FOR REVENUE
Speaking solely for himself, Williams told HNN that Huntington should conduct business under the premise that no revenue will be received from the occupation tax. Although, if approved, the revised Home Rule plan calls for the implementation of the 1% tax, the Cabell County Commission has announced they will seek an injunction and constitutional challenge.
“I think it best if we act as though we be expecting any tax revenue from the occupation tax. Who knows, when or if , we will ever see any? In the meantime , we need to be aggressive and prudent in the way we structure this budget for the coming year,” Williams said.
Comparing the dire need for the asphalt compactor to spending a yearend bonus that did not materialize, the finance chairman said, “There’s no need for us to be planning projects on money we do not know is coming. We can make a clearer judgment by waiting until November or December. If we then have [financial resources], we could then get the asphalt compactor delivered in time for Spring [despite the 16 week delivery lag].”
During the meeting street department heads spoke of having to occasionally use a $500 a week rental for the pot hole compactor.
Williams stated, “We’re not going to be paying that through the winter. It’s expensive, but I’d pay $500 a week in the Spring. All of this [financial shortfall] should clear itself up by then. There’s a value in waiting until the dust settles. We’ll have a clearer picture [of the prospective occupation tax litigation outcome] by late winter or early spring.
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Huntington Finishes Fiscal Year with Shortfall
Don’t Count on Occupation Tax Revenue For Now, Williams Suggests
By Tony Rutherford
Huntingtonnews.net Reporter
Huntington, WV (HNN) - A negative carryover from fiscal 09-10 has placed Huntington’s finances on the edge of a red precipice, leading to a request of at least a two percent budget cut. The Finance Committee at Monday afternoon’s session learned of a budget revision that would leave only $38,545 in the city’s contingency fund.
“The [final] revenue [for fiscal 2009-2010] came in much, much less than predicted,” Finance Committee chairman Steve Williams said. The Budget Revision Request shows a shortfall of about $240,000. In Early September, the Wolfe Administration gave a preliminary expectation of having a $100,000 carry over in the general fund.
Williams said that the liability insurance savings of approximately $500,000 per year , which was approved at the Sept. 13 meeting beginning in fiscal 2010-2011, prevented the city from slipping into the red.
Council chairman James Insco called it “unrealistic” to proceed with the proposed $38,545 contingency, explaining that “does not anticipate unexpected expenses.”
Theoretically, those expenses could already be in excess of revenue. Runyon does not yet have a year to date for the expense column.
In fact, the Finance Committee agenda had the purchase consideration of both an asphalt compactor and a refuse compactor. After hearing that the city has been using a borrowed asphalt roller from the state, several appeared ready to recommend the lease purchase financed through street department funds.
However, Insco suggested to Williams that the budgetary updates be moved forward on the agenda. Councilman Nate Randolph acceded, too, that the number crunching come before a decision on equipment leasing or purchases.
REVENUES NEUTRAL
Although the first quarter of 2010-2011 still has two weeks remaining, revenues are in the words of Finance Director Deron Runyon “neutral.” At this time last year, “we were already behind,” Runyon said, adding that he not ready “to take a victory lap,” with many current revenue items a percentage point or two ahead or lagging.
For instance, the City Service Fee (User Fee) , which is dependent upon employees working in the city has generated about $950,000. By comparison at this time last year, $1.1 million had been collected.
Mayor Kim Wolfe told council that the city has already placed a freeze on non-essential spending and hiring. Wolfe hinted that public works has been sliced “to bare bones” so council may want to reconsider the police and fire department budgets, which were exempt from prior cuts.
HOME RULE REVISION IN COUNCIL VOTER JEOPARDY?
Councilman Jim Ritter told the committee , “I’m not very happy right now,” after reviewing the preliminary financial data. But Ritter’s ire also centered on the previously announced Memorandum of Understanding with the Police Department.
Threatening to switch his vote on the revised Home Rule Plan, Ritter disagreed with the administration’s decision to grant employees a legal holiday for the Saturday special U.S. Senate primary election.
Wolfe stated, “We didn’t have an option; it’s state law.”
City Attorney Scott McClure opined, “You get time off or time and a half pay.”
Insco qualified the answer stating only those employees under civil service would qualify.
Williams believed the Mayor should have checked with other cities in the state before granting the holiday.
Ritter quipped, “I don’t care if [the revised home rule plan] passes or not and Mr. Houck said I can speak for him too.” Both now appear concerned about the administration having too much discretion over receipts that would go into the general fund.
If other votes stand the same and Ritter and Houck vote "no" on the revised plan, it would fail by a 6-5 margin.
POLICE AND FIRE NOW NOT IMMUNE?
After the meeting, Williams explained, that he believes the sense of the finance committee now will “ask the administration for substantial cuts.” He said that Insco wants the contingency replenished to the original $600,000. Williams would prefer a contingency between $750,000 and $1 million. Insco’s preference would mean the 2% cut and William’s preference would mean a 2.6% cut.
“The Mayor is reminding us that [council] voted not to cut police and fire. Read into it what you want, but I think if we are going to cut, we will have to go into the police and fire departments [with budget cuts].”
DON’T COUNT ON OCCUPATION TAX FOR REVENUE
Speaking solely for himself, Williams told HNN that Huntington should conduct business under the premise that no revenue will be received from the occupation tax. Although, if approved, the revised Home Rule plan calls for the implementation of the 1% tax, the Cabell County Commission has announced they will seek an injunction and constitutional challenge.
“I think it best if we act as though we be expecting any tax revenue from the occupation tax. Who knows, when or if , we will ever see any? In the meantime , we need to be aggressive and prudent in the way we structure this budget for the coming year,” Williams said.
Comparing the dire need for the asphalt compactor to spending a yearend bonus that did not materialize, the finance chairman said, “There’s no need for us to be planning projects on money we do not know is coming. We can make a clearer judgment by waiting until November or December. If we then have [financial resources], we could then get the asphalt compactor delivered in time for Spring [despite the 16 week delivery lag].”
During the meeting street department heads spoke of having to occasionally use a $500 a week rental for the pot hole compactor.
Williams stated, “We’re not going to be paying that through the winter. It’s expensive, but I’d pay $500 a week in the Spring. All of this [financial shortfall] should clear itself up by then. There’s a value in waiting until the dust settles. We’ll have a clearer picture [of the prospective occupation tax litigation outcome] by late winter or early spring.
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