The proposed total represents a 2.3 percent increase over the 2013-14 fiscal year budget. The entire budget proposal shows a $5.3 million increase, excluding funds transferred from the general fund balance for a new Cleveland High School gymnasium to replace the structurally unsafe Raider Dome.
Revenue projections show a 3.4 percent increase. Property tax is projected to increase 2.9 percent over the previous year; $77,000 of this will come from the Whirlpool payments in lieu of taxes, according to City manager Janice Casteel. Sales tax revenue is projected to increase by 3.3 percent.
Revenues going into the general fund are projected to be $1.4 million more than last year.
Casteel said these funds will come from local property and sales tax and jetport fuel sales. General fund expenditures and transfers are proposed to increase by $6.8 million, which includes the partial funding for the gymnasium.
Casteel said the budget proposal also reflects a $329,955 decrease in charges for services revenue partially based on the elimination of an animal control contract with Bradley County.
The budget includes a Cleveland Utilities rate increases of .37 percent for electric, 4 percent for water and 4 percent for sewer.
The proposal also includes a 3.5 percent step merit raise for qualifying employees.
Casteel said in some departments a new employee was making the same as a person who had been working there for six years.
“Our pay plan is not working, because we have not been able to fund those steps,” Casteel said.
District 4 Councilman David May Jr. asked who was keeping track of updating information for the city’s compensation to ensure it is paying a competitive rate.
“Are we staying competitive?” May asked.
Casteel said city salaries are.
Casteel said the information is being maintained but addresses new employees, not necessarily five-year employees.
Cleveland Utilities President and CEO Ken Webb said Cleveland Utilities has contracted with a company to keep up with its compensation plan and ensure employees are within market range for their position and experience level.
May asked Casteel to talk to Webb about the contract it had with the company to see if the city could enter a similar contract to maintain more detailed salary data.
A portion of funding to construct a new Cleveland High School gymnasium is the largest item being added to the budget. There is $6 million committed to the project in the budget.
The Cleveland Board of Education recently voted to decrease the project by $1 million. Cleveland Director of Schools Martin Ringstaff said this will be accomplished through bidding nonessential parts of the project as bid alternates, instead of part of the core project. A proposed community room has already been eliminated from the project.
Casteel said funds for the gym project would be taken out of the general fund balance and transferred to the capital improvement program fund to be used for the project.
Other increases are included in the general fund, the Cleveland City Schools budget, Cleveland Utilities and the capital improvement program fund.
There is a 16.3 percent proposal in expenditures for the general fund.
Casteel said this is the fund that has the most focus because it is the operating fund for the city. Based on a prior agreement, increased operating expenses for Cleveland City Schools are being included in the budget proposal.
Casteel said the city had an agreement with the school system that the system would receive an increase in local funding based on the projected increase on property and sales tax revenue.
Casteel said the school system had not been given an operating expense budget since 2011. This was due to the economy and the end of revenue from a fire contract with Bradley County. The 3 percent increase will bring an additional $153,600 to the school system.
A large increase is also included in the budget proposal for Intergovernmental Revenues, “with an increase of $276,700.”
Due to budget constraints, the fire hall at Westland Drive, the fire training tower, a building for public works, the capital equipment replacement program, the veterans home and Spring Branch Industrial Park infrastructure will not be fully funded in the 2014-15 budget.
Casteel said the plan is to fund the firehall from growth revenue in that section of the city. Some of the sales tax revenue will be going to equipment replacement.
Casteel suggested the city use the revenue from Bradley County repaying its portion of purchasing the industrial park property toward the city’s portion on the veterans home
The new municipal building presented at a planning session earlier in the year was pulled from consideration.
All budgets jointly funded with the county remain the same except the Bradley County 911 Center.
The budget proposal for the Bradley County 911 Center included a decrease of $144,500. In the 2014-15 budget, this money was included to make the 911 Center solvent according to the state guidelines. The state does not take the center’s fund balance (reserve funds) in to account when determining if a center is “in the black.” The Bradley County 911 Center had become “at-risk” according to the state.
The city currently funds 49.5 percent of the center’s local funding. Casteel said this agreement will automatically renew in October 2015, if no changes are made. She said if the City Council wanted to make any changes to how the department is funded they would have to do it in April 2015.
“We just don’t want those dates to get past us if you would like to look at your funding,” Casteel said.
Changes were not recommended by city staff during the meeting.
The City Council will vote on the budget at a later date.