City budget officials this week [ Tuesday, April 28] predicted a continued rise in property and sales tax revenues but also in challenges to fund major street projects as well as staff requests for vehicles, equipment and other capital expenses.
Streets were the main topic at the special work session, the first such meeting of the year for the City Council and city staff to start working on budget priorities.
Officials said financing options are open and include a potential bond election, but they said this first step is only about outlining needs and costs, with much more prioritizing to come.
“I think it was just an initial consideration,” said Mayor David Cook. “There is a lot of work to do and a lot of information to obtain prior to the council’s beginning to make good business decisions.”
The street projects totaled almost $71 million and would be divided over a five -year program.
Police requested $1.9 million for purchases, including 10 new patrol cars to replace aging cars. Fire officials asked for $1.6 million, including four Chevrolet Tahoes for $202,000, cardiac monitors and thermal imagers to help find people in burning buildings.
The community services department, by comparison, asked only for a zero-turn mower -- but top of the line at $11,600.
The total for all capital requests was $3.9 million.
Costs and details of expansions of the City Hall and the Public Safety Building had yet to be determined.
A proposed $15 million library also is again on the table. It has been sent to the back burner several times, but Cook said there may be support for funding at least the design costs, although its current plan might have to lose the proposed 300-seat auditorium.
“These are the requests, but that doesn’t mean that this is what we’re going to fund,” City Manager Clayton Chandler said after the meeting. “One of the points was to give the council a good feel for what the numbers look like, and to get them to start thinking about priorities.”
In February 2013, the council ditched plans for a bond election after whittling a $100 million wish list down to about $35 million, the majority for streets. Officials based their action at the time on concerns about the economic recovery and the public’s tepid response to the bond projects.
But instead of waiting for another election date, the council moved ahead with alternative financing for that $35 million list of bond projects, which officials considered the city’s most crucially needed. Streets projects comprised the largest share at $19 million. Others on the list included construction of a police tactical training center and expansions for the overcrowded police dispatch center on Heritage Parkway and the animal control center.
The city paid with certificates of obligation, which are similar to bonds but don’t require an election.
Peter Phillis, city business services director, said the street projects would have to stand on their on merits in each of the next three budget years. He told the council he’s comfortable financing a roughly $25 million package of street projects in the first fiscal year, 2015-16. If the city takes on any more debt for streets that year, he said, “we might have to stretch our debt ratio.”
The ratio is the percentage of the city’s property tax revenue earmarked for debt payments, and it’s one of the bellwethers of a city’s fiscal health. Phillis said the city’s current debt rate is about 36 percent but has been inching down from a high of 52 percent in 1998-99.
The city’s revenues have been rising for several years now, as Mansfield’s rebound from the recession has accelerated.
Sales taxes revenues, which support the budgets of the city and its park and economic development corporations, have increased 22 percent, to $9 million, since the fiscal year following the 2008 stock market crash. The city’s general fund budget rose 25 percent, from $36 million to $44 million, over the same period.
However, revenues from city building permits, a barometer of development growth, tumbled along with the housing market. The $1.5 million in permit fees estimated for this year is almost half its pre-recession high.
“They’ve been slow to redevelop,” Phillis said.
Robert Cadwallader, 817-390-7641