Manassas Park City Manager Presents Recommended 2012 Budget

The presentation of Manassas Park’s recommended budget for fiscal year 2012 was, for the most part, centered on how to overcome the city’s $1.2 million budget shortfall.

 Manassas Park City Manager Jim Zumwalt presented the recommended budget Tuesday night during the regular city council meeting. He explained that the city’s total expenditures are expected to be $35.3 million, but the city’s expected revenue is only $34.1 million, hence the $1.2 million shortfall.

 Zumwalt explained in detail what steps the city could take to bring their budget back into the black.

 The $1.2 million shortfall is in the city’s general fund, which receives dollars, in part, from taxes, grants, bond sales, fees and state revenue.   Employee’s salarie,  city operations  and other things are paid out of the general fund.

 Zumwalt said the city could only see a shortfall of $614,000 if:

A.  New revenue estimates reach $192,000.

B. There is a storm water fund cost shift of $129,000 

C. if the Manassas Park Community Center earns $265,000 in revenue.

The city's department of parks and recreations has experienced a 60 percent growth in their revenue, if your compare January and Feburary 2010 to the first two months of 2011, parks and recreations director Catherine Moretta said during, "Bang for Your Buck,"  Tuesday's special presentation of all the city's departments and department heads.

Parks and recreations has its first $100,000 revenue month in July, Morretta said.

The goal of the department is to earn that much every month, she added.

City officials and residents can help the community center by inviting others and speaking about the community center to other people, Zumwalt said.

 What Zumwalt said he considers to be one of the “harder” steps in saving money is a two cents tax levy for debt service.

 This means taking two cents of the $1.65 per $100 of accessed value in property taxes and using it to make city bond payments and payments on other debts.

 Though this step does not involve raising taxes, it is still difficult because this money wouldn’t be part of the revenue shared with Manassas Park City Schools, he said.

 " ... The two more cents are not increasing the tax rate so it means that money that would otherwise go to the schools being used to pay for city bonds. So that one has a very direct impact on schools," Zumwalt said.

 Right now, the city shares 57 percent of its general revenue with the schools.

 In an effort to cope with shortfalls, the city has, in the past, took an action similar to the proposed two-cents tax levy, he said.

 Taxes were increased from a $1.14 to $1.24 in 2009 and again to the current rate of $1.65 in 2010.  Of that increase, four cents was earmarked exclusively for debt service, meaning that money wasn’t used for the schools.

 The city's deficit can be further reduced by making line-item reductions, keeping legal support at the contract minimum and using city staff instead of contractors to support the city’s Community Development Authority.

During Zumwalt's presentation, Manassas Park Mayor Frank Jones interjected and said city staff would be used to support the Community Development Authority.

"... They delegated authority to me as the chairman so I so direct—that's done," Jones said.

That move would save the city a little more than $13,000, according to the proposed budget.

 If these steps were taken, the remaining shortfall would be down to $254,000, Zumwalt said.

 About $108,000 could be saved by not filling two vacant police officer positions, he said.

An additional $30,000 could be saved by not having police overtime.

 About $28,000 can be saved by not having the city’s annual July 4 fireworks display.

 City council will have to make a decision about the fireworks soon, as the deadline for ordering supplies and making other preparations is fast approaching, Zumwalt said.

The fireworks supplies alone cost about $15,000, he added.

A one-time transfer of money from the capital projects fund could also reduce the shortfall.

 The fund contains about $2.7 million—some of which is money from the general fund that’s left over from past projects that were completed under budget.

Taking money out of the capital funds project is a risk, because it can set the city up for serious problems in the next fiscal year, Zumwalt said.

The one-time transfer could work out well, but only if the city continues to have projects, he said.

 Some “good news,” in the midst of all the city’s budget concerns is that the city’s regional debt service charge is expected to decrease by some $230,000, Zumwalt said city officials learned Tuesday.

 Regional service charges are funds the city contributes to support things like the region’s court system, the sheriff’s office, the commonwealth attorney and the jail.

Funds for the Prince William County Public Library are also included in the regional service charges, but city officials said they could save money by choosing not to support the library at all or reducing how much they contribute.  If this was considered, the city would have to reach some type of agreement with the library system.

 Last year, the city gave some $543,700 in funds to the library, Zumwalt said.

 Other alternatives for reducing the shortfall are decreasing how much money is given to Manassas Park City Schools, reducing the city’s workforce and raising taxes.

 Those things are unlikely, but they are possibilities, which is why they were included in the presentation, Zumwalt said.

The city could do a temporary pay reduction for its employees across the board, but many don't seem to think that's a good idea, he said.

"(Monday) I sat down with the (city's) department heads ... and we talked about that alternative and they said back to me the same thing my stomach had been saying to me ever since I wrote that down—'Zumwalt, please don't do that to our employees. The employees of the city have gone through the trouble of the recession they have gone three years with no pay increase, they are loyal ... we've got to find another way to address that issue,'" he said.

Immediately after that meeting, department head's contacted him with other suggestion on how to cut cost besides, pay cuts, Zumwalt said.

Looking forward to 2012, the goal is to avoid additional layoffs, cover continuing expenditures with revenues and getting the general fund back into the black, Zumwalt said.

 The general fund ended up in the red because over the last several years the city spent less than they budgeted but, at the same time, earned less.

 City officials cut back during the course of each year to cope with shortfalls, but also spent all its reserves and borrowed from others, he said.

 The city is actually in the black by about $1.5 million when the general fund, the debt service fund and the school debt service fund are considered.

 As far as the current fiscal year is concerned, the city is expected to have revenue of $33 million and expenditures of $32.6 million, leaving them with a balance of $350,000 by June 30.

 Zumwalt will repeat his budget presentation as well as introduce all the city departments and their heads at a town hall meeting scheduled for Tuesday at 7 p.m at the Manassas Park Community Center at 99 Adams St.

City council members and school board officials are all expected to be present to discuss residents’ concerns.

The Manassas Park will consider the budget in detail during a workshop on April 12.

The will be budget public hearing on May 3 and the budget will be adopted on May 17.