Defiance’s proposed 2020 budget received a first look by city council’s finance committee Tuesday.
The committee examined the general fund, as well as the police/fire, streets and capital improvements budgets composed this fall by Mayor Mike McCann’s administration. Council’s water and sewer committees plan to meet at 6:15 p.m. Tuesday in the city service building, 631 Perry St., to consider budget proposals for water and sewer services.
Full council is expected to consider legislation adopting the entire budget at meetings in December.
As proposed, the city’s 2020 budget projects at $47,893,757, or 7% less than was set aside for 2019, according to Finance Director John Lehner.
The main reason for the lower budget is less capital expenditures in the water, wastewater and capital improvement budgets, he informed council.
Only one new hire is proposed next year — for a full-time employee in the water plant, according to Lehner. And the city budget includes the promotion of city employee Laurie Flory to income tax commissioner, a position that had gone away in recent years.
The city’s general fund — accounting for many day-to-day expenditures outside of water and sewer services — is proposed at 6.7% less than what was set aside for 2019. Whereas council adopted a general fund of $11,576,683 this year, next year’s proposed spending is $10,804,864.
The main reason for the drop here is that, unlike recent years, no transfer in general fund money to the capital improvements budget is planned, Lehner indicated.
The general fund’s projected balances are showing future decreases.
For example, Lehner noted that a $3.55 million balance at the beginning of the year is expected to drop to $2.87 million by Dec. 31 as some $1.1 million was used from 2017-19 to fund capital projects. The balance is projected to decrease to $2.71 million by the end of 2020, according to Lehner.
He encouraged a “a mild word of caution. We need to be watching and paying attention to the general fund balance as we go forward.”
Revenues from the city’s 1.8% income tax — levied on those who live or work in Defiance — have continued to grow. About two-thirds of this amount goes to the general fund.
For this year, total income tax revenue is expected to reach $10.67 million, Lehner explained, a 3.4% increase (about $340,000) over the previous year. The 2020 estimated income tax take is $10.89 million, a 2% increase.
Next year’s streets budget — primarily funded with gas taxes and motor vehicle registration fees — is proposed at $1,285,680, a 23.8% increase over the comparable 2019 figure ($1,037,925).
Much of this comes from the addition of a $200,000 capital improvements line item, made possible by Ohio’s gas tax increase in July, according to Lehner. This money will be used for street resurfacing, he indicated.
Meanwhile, the city’s proposed police/fire funds total $6,582,835 compared to the $6,701,570 set aside in those two accounts for 2019. (A 0.3% dedicated share of the city’s income tax — approved by voters in 2013 helps fund the police and fire budgets.)
Proposed overtime for police forces is $220,000 next year and $160,000 for the fire department. The police amount is the same figure adopted for 2019; the fire department number is $90,000 less than what was approved for this year.
City employees are set to receive pay raises in the 2.5-2.75% range during 2020, while employee health insurance in the above budgets is expected to increase by 7.95%, noted Lehner. A reserve fund can help offset this by about half.
The city’s 2020 capital improvements budget is proposed at $4.32 million. The main revenue sources are grants ($2.35 million) and the 0.3% share of the city income tax reserved for capital projects ($1.81 million).
About half of this spending ($2 million) is proposed for improvements in the Ottawa Avenue area, including resurfacing, drainage and sidewalk work. This includes reconstruction of most of Karnes Avenue.
Another quarter or so of the capital budget ($973,700) is proposed for the acquisition of buildings on the west side of Clinton Street’s 100 block — just south of the Maumee River — to be demolished and turned into greenspace, mostly with federal and state emergency management money.
The largest capital expenditures proposed in 2020 within this fund include:
• Ottawa Avenue corridor improvements, $1,025,000.
• street reconstruction (Karnes Avenue, from Ottawa Avenue to Summit Street), $975,000.
• hazard mitigation, $973,700.
• street resurfacing, $200,000. This money will be combined with the aforementioned $200,000 line item in the streets budget for paving on Carpenter and Kiser roads; Waterford Lane; Newport Cove; Chippewa Drive; Emory, Perry, First, Second, Fifth and Fales streets; and Sessions Avenue.
• construction of a new salt barn, $150,000.
• contingency, $100,000.
• interest on municipal court construction bonds, $93,325.
• mastic treatment of certain streets, $90,000.
• city parking lot maintenance, $75,000.
• boat dock and reservoir parking lot maintenance, $70,000.
• repair of sidewalks damaged by tree growth in the city right-of-way, $50,000.
• Clinton Street bridge amenities, $50,000.
• Ottawa Avenue/Cleveland Avenue roundabout engineering and right-of-way acquisition, $50,000.
• annual lease of vehicle for snow and leaf removal, $45,184.
• principal on municipal court construction bonds, $93,325.
• street cracksealing, $40,000.