Fort Smith Board gets first look at 2014 budget

Members of the Fort Smith Board of Directors were presented with a copy of the proposed city budget at Tuesday night's (Nov. 5) regular meeting. The proposed 2014 budget totals $201.1 million, with an operating budget of $110.1 million and a capital projects budget of $91 million.

Comparing 2013 to the proposed 2014 budget, the general fund budget is unchanged from 2013 levels, remaining at $47.9 million.

In the introduction to the budget, City Administrator Ray Gosack said the budget is based on a "mixed recovery from the Great Recession that began in 2008." He highlighted specifically that sales tax revenues are only forecasted to increase by between 1% and 1.25%.

"Although other areas of the economy, such as employment rates and construction activity are more robust, the recover of retail sales is lagging," he wrote.

Kara Bushkuhl, the city's director of finance, said as a result that the various city departments were asked to make cuts, some of which were drastic in order to not go over 2013 spending levels while dealing with higher insurance premiums.

"Well, what we basically did in the health care, I think it went up about 24%, is we asked the departments to try to absorb that within their '13 level spendings although it went up."

Gosack further elaborated, saying the increase is "about $1.4 million across all four operating funds."

Among the drastic measures taken to deal with the increase will be the police department not purchasing new vehicles for their fleet in 2014, Bushkuhl said. Gosack added that the police department will also "freeze eight vacant positions in order to provide resources for much-needed training and the emergency operations center."

As for how the Board will react when seeing the proposed cut in the budget, Bushkuhl said removing that cut will only result in a cut of the same size in another city department.

"If they want to make a change, then they're going to have to – if they want to increase a certain budget, then they're going to have to make decreases in another because we've cut it as far as we can."

Gosack said as it stands now, many citizens will not notice the cuts that will happen within city budgets, pointing out that police response times have improved during the last several months of two officers to one squad car instead of patrolling separately.

As for why health care spending went up to such drastic levels, Bushkuhl said it could be blamed on a few different things including the implementation of the Affordable Care Act, commonly known as Obamacare.

"I would say a part of it is, but I think most of it is related to we've been using the fund balance in that actual health insurance fund over the last three years and it's no longer there. So we can no longer subsidize the city and the employee's contributions by those excess funds that we had."

Largely expected was an large increase in monies needed to fund pensions, but Bushkuhl said the increases were not near as bad as health care premiums.

"I'm not sure of the percentage. I would have to look at it. But police and fire pensions went up slightly, but not as much as in the past. The other non-sworn employees, it's still at 10% of their salaries and since there's no increases planned for next year, that will not go up."

Bushkuhl did not address the Board tonight, only providing city directors and the media copies the more than 300-page budget. She will lead presentations of the city's budget on Thursday, Nov. 14, and Monday, Nov. 18. Both meetings will begin at 6:00 p.m. at the Community Room of the Fort Smith Police Department.

In other business, the Board:
• Approved a resolution authorizing the City Administrator to execute a grant letter with The Walton Family Foundation for the construction of the River West Trail;
• Approved an ordinance amending the Master Land Use Plan, rezoning 12010 Old Highway 71 South from not zoned to Industrial Light (I-1);
• Passed an ordinance amending the 2009 Unified Development Ordinance allowing auto parts stores to be granted conditional use permits in some commercial 2 zones; and
• Approved an ordinance ordering the owners of dilapidated structures at 1401 N. 11th St. to teat down the structures within 30 days.