The city’s financial outlook is getting brighter, but staff is still encouraging caution moving forward into the next fiscal year.
At a special March 10 City Council meeting to discuss the proposed 2022 fiscal year budget, Finance Director Diane Pelletier said the city’s revenues continue “to be above the budgeted 2021 COVID” projections.
“If the trend continues during the second half of the year, Boulder City’s c-tax (consolidated tax) receipts, which make up about a third of the general fund revenues, will approach 2019 pre-COVID levels,” she said.
Pelletier said the consolidated tax receipts were $11.7 million in 2019 and $11.1 million in 2020. In the first six months of this fiscal year, she said the city has already received $5.6 million.
“If I annualize that, which is a realistic estimate, it will be at $11.2 (million), so that puts us close to the 2020 number, which is far better than the 40 percent reduction we had budgeted,” she added.
The consolidated tax is a combination of sales, liquor, cigarette, real estate property transfer and government services taxes.
Despite this “good news,” Pelletier said it’s important to remain cautious moving forward because the city’s expenses have increased.
“Boulder City has incurred a lot of unbudgeted expenditures related to COVID and continues to pay expenses for testing, vaccination and cleaning. … Expenditures through December 2020 were $1.5 million,” she said. “Since the vaccination program began in January of 2021, we estimate that the city will incur additional unbudgeted costs of $500,000, bringing total city COVID expenditures to $2 million. So things look brighter for the upcoming year but until everything returns to normal we have to continue to be fiscally responsible.”
Budget Manager Angela Manninen is also recommending an additional $250,000 be transferred from the general fund to the risk management fund in the proposed 2022 fiscal year budget.
“The reason for that is that already for risk management we spent $615,000 this year,” she said. “Three hundred and fifty-two thousand (dollars) is insurance and $263,000 is litigation.”
Council approved this fund in April 2020; its purpose is to pay for insurance premiums and deductibles, claims not covered by insurance and legal defense and settlement proceeds.
As of Monday, March 15, Pelletier said the city has paid or is in the process of paying $256,185 in legal fees for a case involving two former employees.
Councilman James Howard Adams said he thought that was a “reasonable and necessary move.”
“If we’re spending the money … we need to make sure that it’s there … then I think it’s a reasonable place to transfer this money,” he said.
Council unanimously approved having Manninen transfer $250,000 more from the general fund to the risk management fund in the draft budget.
Council also approved having her move money for new golf carts back to the general fund from the vehicle equipment replacement fund as well as creating two more line items in the budget.
One line item would show a breakdown of cart rental revenues and the other would show the expenses of maintaining and servicing the golf carts.
“I would prefer to keep these expenses and revenues in the golf course funds so that we understand exactly what the golf courses cost us,” said Mayor Kiernan McManus.
These proposed changes and the draft of the 2022 fiscal year budget will be discussed again at the April 13 City Council meeting.
The tentative budget needs to be submitted to Clark County and the Nevada Department of Taxation by April 15. If needed, council will have another opportunity to discuss the budget at a special meeting scheduled for April 28 before the final version comes before them for adoption May 25.
The budget can be seen at www.bcnv.org/769/Fiscal-Year-2022-Budget.
Contact reporter Celia Shortt Goodyear at cgoodyear@bouldercityreview.com or at 702-586-9401. Follow her on Twitter @csgoodyear.