The The City of Columbia’s 2023 budget process is underwaywith considerations ranging from funding new jobs to planning for a water rate increase.
Columbia City Council held its first business session Saturday, in which members provided guidance to staff on the direction of business sessions and subsequent hearings ahead of the Sept. 19 meeting that will cement the budget.
The budget process is different this year as budget targets must align with the city’s strategic plan as well as its climate action and adaptation plan.
Revenue is projected at $472 million, with $476 million in projected expenses. There are working capital and currently open positions that are factored into the planned operating expenses of $465 million.
The planned budget includes a monthly water rate increase of $3.19. This assumes that the water consumption remains the same. Electricity, Sewer, Solid Waste and Wastewater currently have no increases. Further talks on utility rates, particularly for water, are scheduled for Monday.
First Ward council member Pat Fowler hopes the Utilities Relief Fund, which has a budgeted increase of $100,000, could be further discussed. Fifth Ward Councilman Matt Pitzer is concerned about the rate hikes related to the upgrades to the water treatment plant.
A cost of service study was conducted on planning for water service rate changes, said Matthew Lue, Columbia’s chief financial officer. Less revenue is collected for water utility operations.
Fowler wanted to know if the revenue reductions were due to usage or the city’s tiered billing system. It’s a bit of everything, says Lue.
Because the increase in the cost of purchasing electricity, a rate change may still occur for this utility, said Dave Sorrell, director of utilities. An electric rate change could probably happen in November.
“We would need to do this based on good data,” Sorrell said, adding that there could possibly be a special meeting of the Water and Light Advisory Council before November to speed up the schedule.
Mayor Barbara Buffaloe wanted to learn more about local renewable energy production to offset costs. A report is still being written, Sorrell said.
The new budget decision points were broken down according to the strategic plan priorities of organizational excellence, safe neighborhoods, reliable infrastructure, inclusive community and resilient economy.
The City wants to hire about 43 new full-time employees, an aspect of organizational excellence. About 29 of them would be paid from the general fund, while 14 would be paid from other funds. The presentation of the budget work session attached to Saturday’s agenda included a more detailed breakdown of the department that would have these new positions.
The city is seeking to adopt the Missouri Local Government Employees Retirement System Rule of 80, which means employees can retire once their age plus years of service equals 80.
The city wants to provide full access to the activity and recreation center for full-time employees. The city previously covered a percentage of the costs.
The city also recently changed its provider of health and vision and dental insurance.
Approximately $1.1 million is budgeted to pay for social services contracts so agencies can work with Columbia/Boone County Public Health and Human Services.
Contract payments were previously supported by a budget of approximately $860,000.
If the budget had included incremental increases in social service contracts instead since 2010, what would the budget be today? Fourth Ward council member Nick Foster asked. Contract budgets had stagnated after 2010.
Other important priorities include transportation, which would include a new transportation study. The city could take a hybrid approach by providing transport to the workplace based on on a presentation of a working session of the council on July 18.
A decision on the garbage service capital improvement will be made once the budget process is complete. It will include a budget amendment, City Manager De’Carlon Seewood said, responding to a question from Fowler. A working session is scheduled for October, Sorrell said. The truck purchase budget will be carried over to the 2023 budget year.
Property taxes are expected to rise 1% each year through 2027. That’s typical, Lue said.
Sales and use tax revenue is expected to jump 17% in fiscal 2023 compared to fiscal 2021. Subsequent years are expected to see more stable revenue increases of 1.5%. The jump concerns the implementation of the use tax after its approval in April.
All parks and recreation operations will be funded by the parks sales tax, rather than the tax and general fund. All capital improvement projects for parks and recreation will be carried out through the general capital projects fund. This will reduce inter-fund transfers and allow for greater transparency, the city said.
Charles Dunlap covers local government, community stories and other general topics for the Tribune. You can reach him at [email protected] or @CD_CDT on Twitter. Please consider subscribing to support vital local journalism.