During a recent government meeting, city officials discussed the financial outlook and budgetary plans for the upcoming fiscal years, highlighting key elements such as bond issuances, general fund revenues, and expenditures.

The 2024 adopted budget includes plans for an additional bond issuance originally scheduled for May 2024, which was postponed due to high interest rates. The city council has now approved a notice of intent to issue these bonds in September, with a follow-up meeting scheduled for September 17 to finalize the issuance. The budget for fiscal year 2025 will only account for interest payments on these bonds, with principal payments expected to be included in future budgets.

The city’s total outstanding debt service is approximately $213 million, with $147 million supported by taxes and $66 million supported by utility revenues. The council emphasized the importance of maintaining a structurally balanced budget, noting that the general fund is projected to have revenues of about $19.1 million against expenditures of $21.1 million for the upcoming fiscal year. This results in a drawdown of the fund balance from $11.9 million to $9.8 million.

Employee compensation adjustments were also a significant topic, with a proposed 3% increase totaling around $1.1 million. The budget includes both recurring and non-recurring supplemental requests, with the latter primarily funded through the city’s fund balance.

Sales tax revenue, a critical component of the city’s budget, has shown a downward trend, with projections indicating negative growth for fiscal year 2024. However, improvements are anticipated in fiscal year 2025 as mortgage interest rates decline and the housing market stabilizes.

Additionally, the meeting addressed the hotel-motel fund, which is projected to exceed expenditures by approximately $91,000 for fiscal year 2025. The Economic Development Corporation (EDC) is set to receive $1.5 million for sports complex improvements, reflecting the city’s ongoing commitment to infrastructure development.

The council also discussed the tax increment reinvestment zone (TIRZ) number two, which is linked to the development of Colony at Cold Springs. The incremental value of this zone is expected to grow as development progresses, with the city retaining 60% of the property taxes generated.

Overall, the meeting underscored the city’s efforts to navigate financial challenges while planning for future growth and infrastructure improvements.