City Council adopts new fiscal year budget

The Libby City Council adopted the city’s budget for the 2015-2016 fiscal year at Tuesday evening’s City Council meeting. The budget calls for a cut in total city expenditures of nearly $800,000 from 2014-2015 spending. The city spent $12,050,142 last year and has budgeted for $11,271,626 for the current fiscal year, which runs from July 1, 2015, until June 30, 2016.

The lion’s share of the city budget is in the water utility, budgeted for $8,625,293 in expenditures this year, up from actual expenses of $8,528,753 last year. Of that budget, $7,534,550 is set aside for completion of the Flower Creek Dam. Last year the city budgeted $9,219,000 for the dam, but only spent $3,248,098. City Clerk and Treasurer Glena Hook said the city put the full amount of the project in the FY2014-2015 budget, as city officials were unsure of the dam’s actual completion date at the time of budgeting. The unspent $5,970,902 from the previous year’s budget has been shifted into the current budget.

The operations side of the city’s water utility is the largest department expenditure in the budget. The total budget for water operations is $800,100, up slightly from last year’s budget of $797,582. The department actually spent $760,256. The water utility’s revenue, exclusive of the Flower Creek Dam project, is expected to exceed projected expenses. The budget calls for $1,044,300 in metered water sales, a drop of more than $260,000 from last year. The average amount of metered water sales during the past four years was $1,135,463.

The police department accounts for the next largest chunk of the city’s budget, with a total of $416,901 allotted for this year’s expenditures. The majority of the department’s budget, $344,800, is for salaries, wages and employer contributions associated with payroll, such as workers’ compensation, unemployment insurance and other payroll taxes. The department came in almost $20,000 under budget last year, spending $387,575 of a $407,080 budget.

The city’s road budget is the third largest department expenditure, growing by 166 percent from last year’s budget. The road department spent $195,434 of an allocated $159,582 in the 2014-2015 fiscal year. The new budget sets aside $424,942. City Administrator Jim Hammons said the increase for this year will be used to protect the city’s recent paving projects.

“The increase is going to fund the chipping and sealing of paving projects during the past several years,” Hammons said. “We’re just trying to get all the streets in Libby to look good and protect them. If we don’t start with this maintenance, we’re going to lose these streets and be back to square one.”

Another growing expense in this year’s budget is for the city attorney’s department, going up from a 2014-2015 budget of $58,200 to $78,000, an increase of 34 percent. The city’s contract with Doney Crowley P.C., allocates $70,000 for the year of legal services. The budget includes an additional $8,000, which is listed in the budget for travel. At the City Council meeting, Mayor Doug Roll said the $8,000 is actually for additional non-standard work to be performed by the firm on the city’s behalf, not for travel. Non-standard work would include trials and appeals taken from city court into district court.

One of the departments taking a hit in the budget is the parks department. Last year’s parks budget was $89,055, which has been reduced in this fiscal year to $68,625. Last year, however, the department only spent $57,347 of its budget.

As part of the budget process, the City Council adopted Resolution No. 1879, which amended the 2014-2015 budget to reflect the city’s actual expenditures relative to last year’s budget.

The resolution corrected line items on the expense side totaling $1,205,286, excluding the $5,970,902 moved into this year’s budget for the dam. Two of the line items amended were labeled sidewalks and curbs, which exceeded last year’s budgeted amounts by a total of $17,293. The 2014-2015 budget allocated $10,000 to the two items, as does the final budget for FY2015-2016, even though $27,293 was actually spent in FY2014-2015. The public works line item also exceeded the budgeted amount last year, as $35,832 was spent, but no money was included in the budget. The 2015-2016 budget allocated $275,332 for the public works line item.

The city’s water distribution project was the largest under-budget project of the city last year. The previous budget allocated $1,740,000, but the final project cost was just $1,539,420, saving the city $200,579, which was also amended in the resolution. The new budget doesn’t have any water projects of that magnitude, creating a substantial savings on total projected expenditures for the city this year.

The city’s fiscal year started July 1, 2015, and runs until June 30, 2016. Due to statutory requirements and the revaluation of taxable real estate, the city budget is always adopted after the beginning of the fiscal year. Municipalities can’t finalize their budgets until after the valuations are released by the state, but then have 30 days to adopt budgets. The city met that statutory requirement with Tuesday’s adoption of the budget.