CAPITAL COSTS DRIVE CITY BUDGET

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Capital costs drive city budget

Summary:

The City Council likely will approve the $50.5 million budget Monday.

By Mark Bliss

Capital projects are driving much of Cape Girardeau's city budget.

The city's $50.5 million fiscal 1997 budget is divided almost equally between general operations and capital improvements.

"I think we probably do more capital outlays than the average city," said John Richbourg, city finance director.

Even so, the city projects spending 20 percent less on capital expenses in the coming fiscal year than was budgeted for the current year.

Capital expenses are slated to drop from $29.7 million to $23.8 million. The capital expenses include about $900,000 for equipment purchases.

The fiscal 1996 budget includes some $5 million for a number of projects, including airport projects as well as construction of the Shawnee Park softball complex and the Osage Park community center.

Those projects will be wrapped up this year. As a result, no funding is included for those projects in the fiscal 1997 budget, Richbourg said.

But Richbourg said the capital budget would be higher if voters approve a bond issue to expand the city's water system. The water system expansion isn't included in the proposed budget.

"I would say it's a lean budget," said Richbourg.

The City Council is slated to give final approval to the budget Monday. The new fiscal year begins July 1.

Operating expenses are projected to increase by only 2.74 percent, from $25.9 million to $26.7 million.

Payroll costs are budgeted at $12.8 million, or nearly half of the city's operating budget.

The city has 365 full-time employees and 103 part-time workers. The number of seasonal employees fluctuates.

The budget includes a 1 percent pay hike for all employees, effective July 1, and merit increases of 2-4 percent that take effect on their employment anniversary dates.

Mayor Al Spradling III said most city employees will get a 3-5 percent pay raise.

The total city budget is about 9.4 percent less than the current $55.7 million budget.

But actual expenses for the current year probably will total less than the new year's budget, Richbourg said.

"This is just a very fiscally conservative group of people that run the city," Spradling said.

The mayor said city employees may feel the council is being too tight with the budget.

But Spradling said the city can't afford larger pay raises without a major tax hike.

As it is, the budget proposes raising the city's property tax rate by two cents to 49 cents. That would generate an added $58,000.

The city's general fund tax would increase by one cent to 33 cents per $100 assessed valuation. The city's health fund tax rate would go from 5 to 6 cents. The health fund pays for animal control, weed abatement and enforcement of other health regulations.

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Parks, recreation and golf fees would be raised 5 percent, effective July 1; water rates would increase 5 percent, effective Jan. 1.

City Manager Michael Miller said the fee and tax increases would allow the city to keep up with operating costs and inflation.

Miller said the budget includes a new computer system and cars for the police department, and the hiring of two more firefighters.

"We are not standing still," said Miller. "We are trying to modernize city government."

Richbourg said the city depends heavily on sales taxes to finance both general operations and capital improvements.

The city's one-cent sales tax accounts for nearly half of all the general-fund revenue. Property taxes, in contrast, account for just 7 percent of the projected $14.2 million in general fund income.

Most of the city's basic operations, such as police and fire, are financed through the general fund.

Two other sales taxes are being used to fund the city's share of the flood control project and street improvements.

CAPE CITY BUDGET

Operating Expenditures (in millions)

96-97 95-96

Administrative $2.18 $2.29

Development 1.26 1.22

Parks and Recreation 2.59 2.34

Public Safety 7.0 6.73

Public works 10.49 10.37

Debt Service 3.10 2.96

Contingency .05 .05