Directors begin review of $40 million Fort Smith budget

Fort Smith City Directors spent a little more than two hours Monday night (Nov. 23) reviewing a 2010 budget the projects revenue of about 3.5% less than 2009 and expenditures about 5.6% below 2009.

The roughly $40 million general budget includes funds for police, fire, administration, parks, engineering, finance and planning.

“The department heads did a really good job” cutting costs compared to 2009, noted Fort Smith Finance Director Kara Bushkuhl during her overview of the proposed 2010 budget. “We have an atmosphere of not spending everything just because we have the money.”

However, because of reduced sales tax revenues, the city is not likely to meet its self-imposed rule to maintain a 15% fund balance in all funds. The balance is sought to deal with emergencies, natural disasters and higher than expected energy costs, Bushkuhl explained.

As of the end of August (the most recent tax collection report from Arkansas finance officials), the county sales tax collection was down 7.01%. The county sales tax for the first three quarters of 2009 lags behind the projected budget by 4.44%. More importantly, the actual revenue loss to the general fund budget is $540,267 to date, with the general fund supporting fire and police operations.

Fort Smith City Administrator Dennis Kelly said the proposed budget is not much different than the 2009 budget because the coming year is “questionable” in terms of what could happen in the economy and wanted to present a simple budget.

“We’re in a very strange time,” he told the directors.

The following key areas were highlights of the first budget session. Directors will meet 6 p.m., Tuesday (Nov. 24) in the Bartlett Community Room of the Fort Smith Police Department to complete the proposed 2010 budget review.

WAGE FREEZE
Kelly asked directors during an Aug. 17 study session to consider a wage freeze for all city employees in 2010. Kelly said Monday there may be a modification to the request.

Planned salary increases in 2010 range from $544,000 to $823,000, or as much as 2% of the city’s average annual operating budget. The city faces an estimated revenue shortfall of $1.5 million, with $620,000 resulting from declining collections of the countywide sales tax.

Richard Jones, the city’s HR director, said a wage freeze will hit hardest those who earn the least. Also, the freeze could catch some people in a spot where they haven’t had a raise in three years. Jones said the issue could be resolved with some form of an option that provides a smaller pay adjustment to people who earn less than $40,000.
City Director Bill Maddox was unsympathetic.

“The way I look at that is, they’ve got a job,” Maddox said.

But he received little support in that view from fellow directors. Director Don Hutchings said city employees “need to know they are appreciated” instead of just being asked to be happy they have a job.

Director Kevin Settle asked Jones to come back to the board with a few options, including days off and other non-compensation benefits.

POLICE FUNDING
Fort Smith Police Chief Kevin Lindsey had a lengthy wish list of 25 new patrol officers ($1.107 million), eight information desk clerks ($263,160), three telecommunication supervisors ($182,000), and seven telecommunication operators/dispatchers (net cost of $165,000).

However, Lindsey prioritized the list, saying the dispatch supervisors are the most important, followed by the seven dispatchers and then the patrol officers.

Lindsey also said the board’s action in 2008 to not allow patrol officers to drive police cars to and from work has been a “big time” hit to morale. He said it is not proving expedient, noting that with the two recent police shooting incidents, investigators and responders had to bypass the scene to get an official car and go back to the scene. Also, the other concern is parking all vehicles in one spot. The 2008 hail storm would have caused more damage if all unoccupied cars were parked at the police department as they are now

Lindsey proposed a plan by which officers who live within 25 miles of the department but outside the city limits pay $25 a month to drive a police car to and from work.

Director Goodman agreed that a change to the car policy is needed, noting that the board’s past decision has run into “the law of unintended consequences.”

On the other police positions requested by Lindsey, Goodman urged other directors and city staff to consider the potential economic benefits of hiring more officers compared to overtime fees, which are estimated to reach $200,378 in fiscal year 2009 for just the patrol officers budget.

BUDGET COMPARISONS
While not a part of the Monday discussion, the following is a list of a few department budget changes between the proposed 2010 budget and the 2008 budget — a potential three year comparison of outlays.

Mayor’s office
Proposed 2010: $245,440
2008 Actual: $208,436
up 17.7%

Board of Directors
Proposed 2010: $116,710
2008 Actual: $86,612
up 34.7%

City Administrator staff
Proposed 2010: $789,370
2008 Actual: $759,410
up 3.9%

Finance
Proposed 2010: $1,173,360
2008 Actual: $1,052,379
up 11.4%

Engineering
Proposed 2010: $1,477,180
2008 Actual: $1,389,789
up 6.2%

Planning and zoning
Proposed 2010: $681,460
2008 Actual: $621,152
up 9.7%