Town faces $562K shortfall in 2013-14
Council in new budget challenge
Despite a carefully crafted five-year plan and an economically successful summer and winter seasons, Mammoth would still come up more than a half-million dollars short of budget expectations for 2013-14, the Town Council learned this past week.
In a workshop that preceded its regularly scheduled meeting on Wednesday, May 1, Town Manager Marianna Marysheva-Martinez said the town would be $562,527 short unless the council put balancing options into place before the start of the 2013-14 fiscal year beginning July 1.
“The five-year plan became the foundation for the town’s future budgets,” she wrote in an agenda bill, “[but] the plan was developed with financials at a high level, and was based on history through September 2012.”
She said after the town’s finance department reviewed individual revenue and expenditure line items, “the resulting financials are different from the initial five-year projections.”
The town fell short, she said, because of five main reasons:
- Sales tax and franchise fees were $120,857 lower than expected.
- Whitmore Pool and the Public Works maintenance position to support the pool were $184,248 more than in the original baseline budget.
- Fewer flights and thus lower revenues at the airport ate up $91,186 in projected revenue.
- Fuel and maintenance supplies at the airport were $47,000 higher than expected.
- Lower gas tax revenue because of another dry winter cost $106,898 in unrealized revenue.
To balance the upcoming budget, Marysheva-Martinez presented to the council savings options that would range between $661,796 and $637,560.
“Their collective value is higher than the shortfall amount,” she explained, “allowing the Town Council to accept, reject or modify some of the options.”
Among the options are to delay hiring a community and economic development director, a budget and management analyst, a second transient occupancy tax specialist and a new police officer.
The subtotal for these delayed hirings would range between $274,235 and $548,471, depending on whether the delay is for six months or a full year.
Also on the table is a police station remodel, road rehabilitation funding, fishing enforcement costs, $17,325 in Fourth of July fireworks costs and $9,000 in Chamber of Commerce subsidies. Depending on how the council wants to schedule the reductions, the town would pick up between $75,033 and $99,269 and have a balanced budget.
The council took no action on the proposed options, since the context of the information was in a workshop milieu rather than a regular meeting.
Also, the outlook for the next fiscal year may not be as bleak as what it appears to be, Marysheva-Martinez said.
“The staff expects that the town’s general fund revenues will improve, although possibly late in the fiscal year, as a result of the enhanced marketing campaign made possible by the new (proposed) tourism Business Improvement District revenues. However, we will not know the estimated impact of this effort on the town’s revenues for months, if not the full fiscal year.”
The actual budget process will begin at the council meeting on May 1. At its June 5 meeting, the council will see an updated budget document, while the new budget should be ready to pass by June 19, Marysheva-Martinez advised the council.