Fort Smith Board approves 2016 budget of $47 million, projects a $700,000 surplus

The Fort Smith Board of Directors approved the 2016 operating budget of more than $47 million at Tuesday night’s (Dec. 1) meeting – with two small changes – that one Director said is a big step toward financial stability.

The first amendment, made by City Director Keith Lau called for a statement of intent that any surpluses realized in 2016 would go toward shortages in the LOPFI fire and police pension fund. The second, offered by Director Kevin Settle, was to move approximately $68,000 in funding to Beautify Fort Smith out of the sanitation fund and into the street maintenance fund.

Both amendments passed unanimously prior to the final vote. The 2016 operating budget of $47.005 million is slightly more than the $46.261 million budget estimated for fiscal year 2015.

While the budget cutting process has been a brutal one for city staff, seeing 50% reductions in retirement contributions and a freeze of all pay raises, they have managed a “$4 million swing,” Lau noted.

As a result, the budget has gone from an approximate $3.4 million shortfall in 2015 to a projected $700,000 surplus in 2016. Lau acknowledged that “we’re still not where we need to be in terms of financial responsibility and keeping LOPFI solvent,” but also saw the final proposed budget as a huge step forward. Lau felt it wasn’t the time to look at fee and tax increases and wouldn’t be until “we’ve cut all that we can cut to the point where we’ve shown the citizens we’re capable of being fiscally responsible.”

“We’re probably still three to five years out,” he added.

Under the Board’s directive to turn in a “lean” budget, Lindsey Kaelin, the city’s human resources coordinator, submitted a proposal to suspend all merit, performance, step, and time salary increases for city employees in 2016. The decision will affect police, fire, and all non-uniform employees. Performance evaluations will continue during the time period.

At Tuesday night’s meeting, the ordinance passed 5-2 with Pennartz and Catsavis dissenting. Coincidentally, this was the final breakdown of the vote approving the final operating budget.

SACK LUNCH PROGRAM

In a narrow 4-3 vote, the Board approved a planning commission recommendation to allow relocation of St. John’s “Sack Lunch Program” to 317 N. F St., from its location at North 6th and B Streets in spite of objections from city staff, the Belle Grove Historic District (BGHD), and Fort Smith Housing Authority Executive Director Mitch Minnick.

In comments to the Board, Minnick noted how additional social services to the area could “discourage investment” in the historic district. Director Wally Bailey of the city’s Development Services department echoed those sentiments in explaining why the staff could not recommend the change.

Writing to the Board in a memorandum dated Nov. 23, 2015, Bailey cited Action HN-2.4.1 of the city’s Comprehensive Plan Update, which reads, “Continue to support, in accordance with the recommendations made by the Homelessness Task Force and adopted by the City Board, the creation and Implementation of the campus concept to consolidate existing homeless and social services south of Garrison Avenue.”

Moving St. John’s Sack Lunch Program to the new location effectively goes against that measure, placing the site next door to the Riverview Hope Campus at 301 S. E St. The consolidated campus broke ground on Oct. 22, 2015.

The Sack Lunch Program provides around 55,000 lunches annually to needy residents, most of whom live on the north side of town. Representatives from St. John’s Church emphasized that they would be willing to work with the Hope Campus, delivering lunches to homeless residents using the facility while maintaining its own presence across the street.

Ultimately, Directors Don Hutchings, Pennartz, Good, and Catsavis voted to approve the program’s relocation, while Settle, Lau, and Lorenz, voted against.

PARKE SCRUTINY
Also Tuesday night, Fort Smith Utilities Director Steve Parke once again fell under the scrutiny of Directors Catsavis, Lau, Pennartz, and Settle, who have been critical of his handling of the department throughout 2015.

The Directors have grilled Parke over billing procedures and spearheaded multiple votes rejecting his proposals in regard to the $480 million consent decree for the city’s violations of the Clean Water Act. Tuesday night, Parke was handed another defeat as part of the Board’s consent agenda.

Seeking authorization of a $198,000 contract with Morrison Shipley Engineers, Inc., for engineering services in the replacement of Lift Stations 15, 16, 17, and 23, Parke came up one vote shy with Catsavis, Pennartz, and Lau, voting against and Good, Settle, and Lorenz voting for. Hutchings who left the meeting prior to the vote.

In spite of Settle’s vote to move forward, he didn’t offer Parke much confidence when requesting that in 2017, water and sewer financials be reported separately “for greater transparency.” He also joined with Lau in questioning the logic of “100% inspections” on bonded and insured construction companies.

If the city had to have 100% inspections on these companies as Parke’s proposals have suggested, Settle said, “then maybe we shouldn’t be doing business with them.”

Director Pennartz also criticized Parke’s recommendation to accept the bid of a $1.5 million contract with KAJACS Contractors, Inc., for the replacement of the same Lift Stations in the Morrison Shipley contract. Particularly alarming for Pennartz was the fact that the lowest bid from KAJACS had been $300,000 higher than the estimate.

The Board’s next meeting will be a noon study session on Dec. 8 from the Fort Smith Public Library’s main branch on Rogers Avenue.