More than a year away, city braces for tough 2015

Revenues predicted to create tight budget again

Though the 2014 budget is shy of being finalized, Jefferson City officials already have begun bracing for another tough fiscal year in 2015.

At a previous budget meeting, 2nd Ward Councilman Shawn Schulte asked City Administrator Nathan Nickolaus to give a preview of where the city would be if they were to begin the budget process for the 2015 fiscal year. Nickolaus said the city has used a number of one-time revenues to balance the 2014 budget and those funds will need to be made up for in the 2015 fiscal year.

Nickolaus said a transfer from the transit fund of $300,000 was a one-time transfer, which helps to create a hole that will need to be filled at the start of the budget process. Nickolaus said if the council started the 2015 budget process today, the city would be about $345,000 in the hole, though he noted predictions this far out are “a bit of crystal ball gazing” and guesswork.

“You’re looking at more than a year out, so it’s difficult to predict,” Nickolaus said.

He said if city staff works on the assumption that no new equipment will be purchased, no new hires made and no expenses added, other than some unavoidable increases such as insurance and gas, expenses likely would exceed revenues, even with modest revenue growth built in.

“We’re optimists, so we built in some modest growth in sales tax,” Nickolaus said.

Though he urged the council with his predictions to “have as few things in the budget as possible that are continuing expenses,” Nickolaus noted that anything could change in the next year and create a completely different situation for the 2015 budget, especially considering how early the process of budgeting begins.

Often, city officials are well into the annual budget process, at least behind the scenes, by February, which is only four months into the current fiscal year. That is why Nickolaus said he believes the budget process starts too early.

Nickolaus pointed to the number of things that changed between the release of his proposed 2014 budget in May and the release of Mayor Eric Struemph’s proposed 2014 budget in July.

“A lot of things changed,” Nickolaus said. “There was actually more income (in the mayor’s budget) ... things will continue to change.”

Nickolaus said that is emblematic of how fluid the budget should be. It is a document that should constantly change with the economic conditions of the area, though many choose to view it as more of a concrete plan.

“A lot of people have this concept that the budget is this perfect document that will show exactly what we plan to spend and exactly what income we’re going to bring in,” Nickolaus said. “That is completely wrong. The one thing I know about the budget, is that it is wrong.”


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