At the special city council meeting on the budget last night, the city staff presented a budget for 2015-2016 that included projected unspent funds from the 2014-2015 budget. Historically there have been $1M-$2M of surplus funds at the end of the fiscal year. This comes about because of conservative revenue estimates at the beginning of the year or reduced expenditures for a variety of reasons, such as delays in filling vacant positions, etc.
Last year, the council instituted a new budget policy with respect to the end of year surplus funds. The new policy was very clear that any end of year surplus dollars could not be used by city staff as a fund source for the next fiscal year. The council would direct the use of those end of year funds into one time projects or debt reduction within 90 days after the end of the fiscal year. Yet, last night, the council allowed the staff to use $1.252M of the projected $1.4M end of FY 2015 surplus to be used as a funding source for the 2016 budget. So, the council clearly violated their own policy.
Furthermore, the staff proposed using the surplus funding (whose exact amount will not be known until after the close of the current fiscal year) to fund road maintenance projects. Since road maintenance is clearly a baseline budget item, it should NOT depend on surplus, prior year funds. This appears to be a ruse to obfuscate other spending.
Stay tuned!
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