The general fund is supplied money primarily through the first penny sales tax and property taxes. If the revenues (first penny sales tax and property tax) exceed the expenditure (the general fund departments' expenses) then there is a surplus, hence the growth in the fund, usually referred to as the unobligated balance.
As the primary operating fund, the general fund is comprised of budget expenditures (appropriated by the city council) of all general departments not supported by user fees. No funds may be expended without the council appropriation approved by city ordinance. In the 2011 Budget, 85% of the expenditures were personnel costs, 9% of the expenses were for other operating costs, 6% were for capital expenses.
Personnel costs encompass wages and benefits for the mayor, city council, appointive officials, full time and part time civil service employees and temporary and seasonal employees, workers compensation costs, health insurance costs, liability insurance costs. Other operating costs encompass operating and administration costs for departments, i.e., new and replacement computer hardware/software, gas and utilities, supplies and materials, education, travel and training, telephone costs, consultants and contracts, to name a few.
There are many ways the Administration can save money thereby building up the general fund unobligated balance in order to use as a funding source for the Event Center. Here are some things to watch for during the year to indicate the mayor is building his cookie jar.
- Set the annual budget at zero percent growth. What this means is departments will have to eat any inflationary costs in non-discretionary spending which will impact their ability to fund program services expenses.
- Put a hiring freeze on any new and/or separated employees.You also won't be able to afford to staff a new westside library or a new fire station since all those costs must come out of the general fund.
- Limit the hiring of temporary or seasonal employees. In Parks and Recreation, this would limit recreation program services offered in the summer. Summer maintenance and repair programs and winter storm removal will be impacted in Street Maintenance.
- Slow down purchases of new computers, new or updated software requests, etc. This could mean a negative impact on services to the public.
- With supplies experiencing high inflationary trends, this will limit the resources available for their purchase.
Bringing an ordinance forth to allow general fund dollars for construction costs is unprecedented.
There are funds identified in city government for construction and infrastructure needs: the second penny sales tax, the entertainment tax, and bonding. I hope cautious heads prevail at the city council level if they adopt such a drastic change in fiscal management of taxpayer dollars. What a city council does today to finance an event center could have serious ramifications to the operation of city government as we have known it.