A new fiscal year for the City began July 1. The approved budget for our 2009-10 year can be found on our web site, www.clarksonvalley.org. As you look at these numbers, I am not suggesting you skip to the bottom line (the deficit number). However, because it is significantly lower than previous years, it does take out some of the anxiety to know things are getting better. You will note our projected deficit for 2009-10 is $7,437. This is substantially different from last year’s deficit of $143,573. This dynamic change has been brought about by: 1) an increase of 6% in revenues and 2) an 8% reduction in expenses. As you review the numbers, let me share some highlights.
As many of you know, our biggest source of revenue comes from the state sales tax. It will vary year to year, but historically, it’s in the 38%-40% range ($360,000 forecast for 09-10). Real estate taxes are about 13% ($120,000). Traffic and other police citations are about 20% to 22% ($209,000 for 2009-10).
Let me address any complaints you might hear about “speed traps”. My answer is real simple—as long as people are driving 15-25 mph over the speed limit, we will continue to check speeds. If that’s a speed trap, so be it.
Back to the budget. 56% of our revenues are directly related to economic activity (sales, cigarettes, gasoline taxes and utilities/franchise fees). So obviously, when the economy is down, our revenues are down—sounds like a household budget problem?
We are constantly looking for ways to reduce controllable expenses; i.e. office, computer expense, telephone service, training, etc. However, our major annual costs are: police protection $375,389 and sanitation $302,647. These are controllable to a limited degree and our actions have resulted in substantial reduction. They amount to 72% of our total expenses. The good news—both are down from 2008-09 actuals: police from $382,608, down $7,219; sanitation from $374,542, down $71,895. The sanitation reduction is a result of going to once-a-week trash and no yard waste pickup during the months of December through March.
The good news—we are within striking distance of a balanced budget. Our current surplus is over $430,000, so, with prudent management, we believe a balance is achievable when the economy picks up. And we believe there are sufficient resources available to afford small deficits till then.