The City of Phenix City held a meeting on the 2020-2021 proposed budget on August 6. The general fund for this fiscal year is $46,086,602, an increase of $1,499,069 over last year’s budget or 3.25 percent—mostly from taxes, fine, and forfeitures. No tax or fee increases were proposed or expected. The city plans to spend $45,859,518 from the General Fund with operating expenditures at $43,059,519 and debt service transfers at $1,500,000. A projected revenue balance over expenditures of $227,084 is expected.
“Every year, we present a balanced budget,” City Manager Wallace Hunter said. “The increases basically show the city’s growth and that management of our revenue is being taken seriously and being put to good use.”
Currently, the city has a AA- rating with Standards and Poor’s, which is equal to the rating of the state of Alabama.
“What we plan is to go back before Standards and Poor’s to get the minus gone. We want to have a better rating than the state of Alabama itself,” Hunter said. “They told us before if we continue with the way we manage our money with the increases and paying off debt (the rating could improve)…We have done that and followed that model. We’ve been able to meet our goal as far as reserves.”
City employees will receive a two-percent cost-of-living raise in October with an additional one-percent to be given in April 2021. Merit raises for eligible employees will also happen in April. Though it wasn’t announced in the meeting, Hunter said Public Safety employees will be getting a six percent raise this fiscal year—five-percent in October and one-percent in March.
“We have to stay in a competitive market with Public Safety,” Hunter said. “And they are on the front lines. They are not only essential workers, they are in a hazardous environment all of the time.”
Capital Improvements and Utilities
Capital improvements include resurfacing Dobbs Drive, Knowles Road, and 43rd Street as well as the bridge replacement on Seale Road. From the Capital Improvement Fund, $13,507,171 in major capital improvements has been budgeted, and $1,535,457 will go for lease payments, vehicles, and equipment. This will include continuation of the paving program initiated in 2012.
The proposed operating budget for the Utilities Division is $13,113,455 with a utility debt service budget of $3,597,630 which includes $1,790,000 in principle reduction. That is an increase of $132,772 from last year.
“There’s a lot of stuff we’ve had to change about infrastructure,” Hunter said. “They are always working to try to get that done throughout the city—the wastewater treatment plant and water filtration plant—we still have a lot of projects that are ongoing. They’re doing a good job in utilities.”
No rate increase is anticipated. Departmental capital improvements and equipment costs are projected to be $639,868. This includes $57,000 in improvements from system development fees and capital funds. Revenue warrants expected to be issued are $8,000,000 and include replacement of older water and sewer mains, the expansion of the Wastewater Treatment Plant, and new water and sewer mains.
The Second Mortgage Fund budget is $100,000, along with $50,000 in the general fund for the removal of dilapidated and obsolete structures. The Seven Mill Fund for general obligation debt is $4,966,518 and includes $2,855,000 in principle retirement. Gas Tax Funds is $500,000 for road improvements. The Corrections Fund is $55,000 to help defray the cost of operating the municipal court. The Confiscated Property Budget is $15,000 to assist with operations of the Police Department. The budget Public Building Authority is $10,243,781 with $9,000,000 in capital spending and $850,000 in principle reduction to improve administration buildings.
As for how the pandemic has affected the city’s budget, Hunter said that the State of Alabama has been good to the city with the money it has handed down.
“We’ve seen an increase as far as our sales tax. We get criticized sometimes for having so many drive-thru restaurants, but that has benefited us during this pandemic because that’s what people go to now. Our grocers have done well. Wal-mart and Home Depot have done super-duper good in the city of Phenix City.”
Hunter said that the help people have been getting from the government has been counteracted because people are paying much higher prices for groceries.
“People forget about that,” Hunter said. “People are spending that (relief) money, and we’re seeing it through an increase at the registers in sales tax, too. So, I have to tell both sides of it. I like that it’s helping the city to be able to keep our workers working and us paying them, but at the same time, those citizens do need that money because everything has increased out there.”
Hunter added that he hopes everyone stays safe and he thanks the council and department heads for working so diligently through the budget process.