Ark Valley News - Question marks in proposed city budget

Question marks in proposed city budget
Last Updated: July 29, 2015

A few things are puzzling about the City of Valley Center's proposed 2016 city budget.

And it's not all about the proposed tax increase, either.

Since the departure of former City Administrator Joel Pile, there seems to be a major shift in how the city handles its finances. Pile was extremely conservative. Each year, the budget contained relatively large fund balances in an effort to meet all financial obligations in seemingly worst-case scenarios.

It was a smart approach in many ways. But we understand the opposing theory that the city owes it to its residents to fully spend the tax dollars it collects.

The approaches aren't mutually exclusive. When planned wisely, spending and saving for a rainy day are achievable together.

We fear, however, that the proposed budget for 2016 tips the scale too far in the opposite direction, rapidly reducing fund balances in one-time chunks while increasing ongoing expenses. (Most of the fund balances will be used on one-time expenses. At the same time, however, expenses related to personnel and other annual commitments are increasing substantially.)

That's risky because it almost ensures tax increases in the future.

We hope city council members will address the following questions as they finalize the city's spending plan in August:

•Does the budget need a 2-mill property tax increase? The proposal uses the additional mills as a way to build reserves and raise the city's taxing authority as it prepares for a state law that sets a cap on tax revenue increases in 2018. We understand the effort. However, are there areas in the proposed budget that can be trimmed to make up the roughly $91,000 that will be raised through the 2-mill increase?

We've long encouraged cities to set their budgets in line with their property valuations. Valley Center's valuation increased by just under 2 percent. The proposed property tax increase is about 3.5 percent.

And, we shouldn't forget, the city increased property taxes by about 2 mills last year.

•Why are expenses in every department in the general fund increasing — some by thousands of dollars — except for the fire department? The fire department's proposed budget takes an $11,300 hit, most of it from the part-time salary line. By comparison, the salary line in the administration department (which is getting a new employee in 2016) is set to increase by $84,000 compared to what was budgeted in 2015.

•Why are expenses in the utility funds increasing so dramatically?

Setting the city's budget is a difficult task, we know. We just want to be sure all bases are covered and all questions are answered.

— The Ark Valley News