Council scrutinizes dire budget, considers listing Event Center

The recent Kimball City Council budget workshop began nearly 30 minutes late as city employees made copies of the budget for more than 30 citizens in attendance.

With a budget shortfall of approximately $100,000, the mill levy nearing its limit, and with Keno receipts being at the lowest point since February of 2015, Kimball's council has tough decisions to make.

"Two years ago we brought $765,000 (in sales tax revenue)," City Administrator Daniel Ortiz said. "This year we are on track to bring in just shy of $500,000. Last year we really cut back on sales tax and budgeted $605,000. That includes the motor vehicle tax."

Ortiz explained that with the vast reduction in sales tax, the City is challenged with how to continue operations and provide multiple services.

"I think that when we went to the budget workshop on July 5, it was no secret that we are going to have some very dire cuts to make," Ortiz said. "The consensus coming through that and following the council at that time was to look at the Event Center."

Council member Christy Warner asked Dorothy Griffith, manager of the event center, if the facility could make a profit if it was leased out to a professional, similar to the Pro Shop at Four Winds Golf Course.

Griffith answered that it could potentially break even, but most likely would not make a profit.

"When we are subsidizing some $50,000, how would it break even for somebody?" council member Schnell asked.

For months Schnell has been saying 'love it or list it,' and that is fast becoming the sole option for the council as public safety and infrastructure departments are suffering.

Subsidies to the Kimball Event Center from sales tax have been reserved instead to maintain other operations, according to Ortiz. Cuts have been made to nearly every department, including the cemetery, whose primary revenue stream came from sales tax.

"The cemetery was probably one of the more drastic ones. You will see the total revenue decline from $128,000 that was budgeted last year to just $36,000 (proposed for the coming fiscal year)," Ortiz said.

Additionally, council chose to reallocate a full-time cemetery position to the water department and the employees in the water department, power plant and electric crew will be asked to maintain the cemetery alongside supervisor Jeremy Williams this coming year.

"Honestly speaking, if this doesn't work we will have to revisit this next year," Ortiz added. "We are in dire straits and we will try to make this work. As we go through you will see that there really isn't anywhere else to cut."

The Park and Recreation department, which encompasses the golf course and the ball park, is a joint operation between the City of Kimball and Kimball County, with each entity contributing $85,000, according to Ortiz. An executive board governs the department with four City Council members, all three Kimball County Commissioners as well as the county attorney, and the Mayor as the moderator with no voting power, according to council member James Schnell.

"I think, if I remember correctly, in terms of revenue, the last two years have been a bit of a struggle and the City has had to cover the shortfalls out at the golf course area," Ortiz said. "Accumulated totals since 2010 is close to $32,000. We don't have the luxury to cover the golf course this year, and so if they are really in a bind we will probably have to have a serious conversation about the long-term outlook of the golf course and the ball fields."

Last year the executive board chose to acquire equipment totaling nearly $157,000 for the Park and Recreation department and to be shared with the cemetery.

"That (purchase) was financed through a loan, locally through Points West," Ortiz said. "The loan payment is due, I believe, in December and that is roughly about $33,000. So, as we get closer to the end of our fiscal year, that is something we will have to watch closely with the operating board and the executive board to make sure that if they don't have the funds to cover that we can figure out what to do with that."

The Park and Recreation budget includes a line item expense titled legal and professional in the amount of $50,000. Ortiz explained that the charge is due to an IRS audit.

"Two years ago the IRS came in and audited our books and the one thing they zeroed in on was the current contract with the golf professional," he said. "The IRS told us that the existing contract didn't fit the criteria of an independent contractor."

Originally the IRS wanted the City to make the position a fit as a full time staff member, complete with inventory buyout. At that time the executive board restructured the Golf Pro contract to make it fit within the Department of Labor's independent contractor criteria.

"That $50,000 is the amount that the operating board pays for the golf pro," Ortiz said.

Additionally, the proposed budget includes a salaries and benefits line item in the amount of $148,000, a $10,000 increase from the 2015-16 budgeted salaries for the department.

The Park and Recreation executive board meeting is scheduled for Tuesday, August 16 at 5 p.m. and is followed by the City Council meeting at 6 p.m.

Other public areas are likewise struggling as maintenance for Gotte and City parks come from sales tax and are supplemented by occupation tax.

"The parks (proposed budget) currently show a deficit of $3,000," Ortiz said, "with no opportunities for revenue."

With grants from the South Platte Natural Resources District and funding from City Keno funds, part of the proposed budget was increased from $10,000 last year to $15,000.

"It's just hard to up it from what we did last year with a tight budget," Warner said. "I feel like we should at least try to balance it, not be in the hole if we can. I guess I just have a hard time with that."

Schnell suggested changing the timers on the sprinklers to save water. Ortiz added that chemical costs could possibly be reduced as well.

"I don't want to take away from their utilities. I know that (John Heidemann) tries to come under his budget every year," Warner said. "I appreciate the last two years worth of budgets because you (the park department) have come in under budget. Thank you."

The Street Department, one of a few that routinely comes in under budget, has been reduced by half from last year. This is due to previously planned capital projects that will not be completed. Those projects were mostly turning lanes on Highway 71 at ShopKo and on Highway 30 at Castronics, according to Ortiz.

The budget includes the 20 percent, or between $120,000 and $170,000 for the City's share of the underpass project as well as the payment of $7,308 for the new street sweeper and insurance increases.

The Kimball Public Library is primarily funded by sales tax and is augmented by occupation tax, and while the council budgeted just over $77,000 in sales tax budgeted for the coming year, higher by nearly $11,000 than the current year's allotment and matching that of the 2014-15 fiscal year, the library has some major cuts to make.

"This is the most difficult because trying to come up with revenue to help operate the library was very difficult. The County last year contributed $15,000 to the library, but they haven't made a determination on what they can do this year," Ortiz said. "Their total revenue is $123,000 and based off of the figures and estimates that Jan (Sears, head librarian) provided, their total expenses are $171,000 and that is a deficit of $48,000. With our resources, we can't support that."

With the library's certificate of deposit removed from the expenses list, the deficit dropped to $21,000.

"I know it looks bad and we will try to figure things out. We will watch expenses the best that we can," Sears said. "It's an asset and a thing to be proud of in the community."

Library board president Rosa Ellen Williams, said that because the Kimball Public Library is accredited with the state, they are eligible for grants. Last year those grants totaled $13,000.

Suggestions for the library included reducing the staff by one part-time position and use volunteers, charging for use of the meeting room at the library and library cards as well as increasing fees for other uses to increase revenue and cutting hours of operation to conserve funds.

Mayor Keith Prunty said that he believed a library improves quality of life, just as a swimming pool does. And like the library, the local pool is funded by sales tax and is augmented by occupation tax.

Though it is currently operating on a $2,000 deficit, the Kimball Public Swimming Pool also generates revenue through entry fees, accessory rentals and candy sales.

The deficit can be attributed to rising chemical costs though budgeted amounts for office supplies and repairs have been decreased drastically.

Suggestions to further reduce costs include purchasing treats locally instead of from Schwan's, ceasing to provide uniforms for lifeguards at a budgeted cost of $1,250 for the upcoming year, and asking lifeguards to host fundraisers to pay for the swimsuits.

"When you are a parent of a fifteen-year-old and they are going to make $9 an hour and then on top of that you have to spend $100 on uniforms," Ortiz said. "It is a struggle as it is trying to keep lifeguards."

Council considered raising daily admission costs, as well as individual and family passes with a suggestion from Schnell to raise the admission costs 12.5 percent or 25 cents for daily admission, $50 for an individual pass and $85 for a family pass.

Fire maintenance and fire equipment budgets remained basically unchanged and more about the Police Department's budget cuts can be seen in a separate story.

Utility department figures were not reviewed at the most recent meeting. The next City Council meeting is scheduled for Tuesday, Aug. 16 at 6 p.m with no more budget reviews scheduled prior to that meeting.