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07.24.06 -- ARTICLE: McIntosh faces budget shortfall

McIntosh faces budget shortfall
Town council juggles options between raising water or increasing taxes to balance budget


McINTOSH -- The McIntosh Town Council met Monday night to discuss how to manage a draining budget.

For the fiscal year to date, the town is running $42,737.17 in the red. Council members are in a quandary as to how to put a stop to this year’s shortfall and begin to build reserves back up.

Several ideas were on the table for discussion. The basic trimming of expenses has been a council priority for the last six months. But council members questioned if this would be enough and asked Town Clerk Julie Musselman to produce projections of the town’s budget showing what would be needed to balance the remaining budget by raising either the water or increasing the millage rate of the Ad Valorem tax.

Council Member Jim Strange also asked the public of about five people, "How can we raise the revenue, people?"

The water rates in McIntosh have not been raised in about 10 years. The last time rates were raised, they were lowered again by a succeeding council because the rate hike caused a hardship for the elderly.

But McIntosh currently has the lowest water rates in Marion County at $6 for the first 5,000 gallons and 50 cents per 1,000 gallons over 5,000. The Marion County rates are $10.37 for the first 6,000 and $1.39 per 1,000 gallons. McIntosh has the lowest water rates in Marion County. See County schedule.

The council members have discussed raising the base rate in McIntosh to $9 and then possibly raising the rates per 1,000 gallons as one way of decreasing the shortfall.

McIntosh brings in $19,887.87 in water revenue. But the town's current budget shows an expenditure of $27,878.69 including a percentage of salary for town employees, repairs, upkeep for the tower and water testing. Since the portion of the town employee salary falls under the budget line of the water, council members are unsure of how much of the water operating deficit is purely a shortfall.

"So instead of $8,000 in the hole, we might be $4,000 in the hole," Strange said.

Another method could be raising the Ad Valorem millage rate. Either way, the council will be ceasing McIntosh's traditional property tax rollback. In the past, McIntosh has decreased the percentage of tax taken so the tax amount stays the same. Currently the rate is 1.2611.

Monday's budget hearing was the first of this kind that McIntosh has ever had, according to Council Member Eunice Smith. She said in the past the previous councils approached the budget differently. As this is Council member Frank Ciotti's first year on council, he sked Smith to explain some of the finer details to the budget. Strange asked Smith’s opinion on how the town handled deficits in the past.

Smith said she’d like to see what the rest of the year worked out since they were only looking at eight months of the budget.

“It might not be quite as bad as it looks,” Smith said.

Phillips countered her and said that it could be worse. “You never know until you project,” Phillips said.

Council members have several options for dealing with the shortfall. One is cutting expenses. The council would like to cut from is law enforcement. This fiscal year shows a $46,188.75 charge and the town expects this charge from the county sheriff to increase to $51 thousand. Council President Joe Phillips said they have three options with this expense. They can pay it, let it go to MSTU and individuals will pay it or simply not pay it.

Another issue council addressed is the allocation of state and county funds earmarked for road maintenance. A chunk of the town's income comes from a state gas tax, $60,009.13, and a county one-cent gas tax, $10,317.58. Portions of this money are by law meant to be spent only on McIntosh roads and road upkeep. This money is included in the town’s income to date and the town is $42,737.17 behind for the year.

Strange suggested two projects that could be taken on so that this money is properly used. One was filling the shoulders of the roads and another was fixing Avenue E on the West side between 11th Street and 12th Street. He said with cutting the sheriff’s fees and other budget cuts, the town should be able to accomplish road repair and perhaps balance the budget.

Another concern council members had were Attorney Scott Walker's fees. The town attorney’s rates have nearly tripled after he gave his resignation and then began a new agreement with the town.

“What we’ve got to watch is the attorney’s fees,” Phillips said. “We’ve got to get a handle on that.”

Another challenge looming for the council is how to rebuild the reserves when the town doesn’t have many options for building revenue. The town's reserves had been in the $600,000 range several years ago. But after the hurricanes, when money was taken to pay for clean-up and then reimbursed by FEMA, the reserves have fallen to $422,766.59. Musselman reported other towns in the area like Reddick have a million dollar reserve.

“All I’m saying is that if you’re gonna run a business, it needs to be run and in this case not to profit but so that we have a reserve,” Phillips said. “You just don’t know what’s gonna happen.”

Strange said he’d like to see the town not try to tackle rebuilding the town’s reserves all in one year.

The town council plans another budget hearing Aug. 17 at 7 p.m. in the Civic Center to revisit these issues when they have better projections.

Other news:

* Joe Phillips said that though he had not brought it up at a council meeting yet, he intended to ask a resident to pay for the July election of the charter amendment. "I think we had a citizen volunteer to pay for this last election in two council meetings and I think we should send her the bill," Phillips said. At previous council meetings, the town council discussed with Charlsie Stott, petition committee chair, the idea of forcing her to pay for the election. But this arrangement was never agreed on and the town footed the bill. The town has paid $2,874.85 for elections for this year, last November's election and the petition amendment election. Stott was not present at the Monday night workshop.

Check out this story about Engelwood raising the water rates: Water rates could go up.

posted by Cher @ 10:49 PM,


At   July 24, 2006 11:55 PM     ,    Anonymous Anonymous    said...

Why would an individual citizen have to pay for the election??

At   July 24, 2006 11:59 PM     ,    Anonymous Anonymous    said...

I think that raising the water rates would at least be a good start and then they could see where to go from there. Afterall, I don't think that $6.00 per month is going to break anyone in this town.

At   July 25, 2006 8:11 AM     ,    Anonymous Anonymous    said...

An individual citizen paying for an election? That is not a very good idea. How about our town council learning how to budget! You don't buy it if you don't have the money to pay for it. like the thousands of dollars they have spent on code enforcement? This is such a small town why do we need large expenses?


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I'm Cher From McIntosh, FL I'm a graduate student at the University of Florida working on a master's degree in Mass Communication. While I was finishing my undergrad degree in journalism last year, I reported on McIntosh, Fla. for an in-depth reporting class. I figured that the reporting and the public record files should go somewhere people can access them. Reporters don't report to keep the information they find to themselves. Some of that reporting is included here in a forum that allows response. McIntosh suffers because with no news coverage, the local government and the rumor mill have too much potential to run rampant over residents. I moved to McIntosh in the fall of 1999. My profile

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