FORT MADISON — City Manager David Varley presented the fiscal year 2019 municipal budget Monday evening at Fort Madison City Hall, showing numbers that dip heavily into the minimum working capital, or money available for the city to complete day-to-day operations.
Officials aim to keep the minimum working capital around 33 to 35 percent of the total general fund expenditures. In fiscal year 2018, minimum working capital was 24 percent, and it’s proposed to fall to 8.5 percent in fiscal year 2019.
“It’s definitely getting down to where we don’t want to see it,” Varley said at the budget presentation. “But we think this is a one-year dip.”
Varley said the reason is twofold, stemming from slightly increased property taxes from tax-increment financing-funded projects or incentives being paid off and some large one-time costs not likely to reoccur in the fiscal year 2020 budget.
Those large costs include $70,000 toward a new fire truck and $197,810 toward two large building demolitions.
“And that combined with the change in property tax revenue is why we think that when we put the next year’s budget together we will be able to start digging out of the hole and building minimum working capital reserves back up to where they should be," Varley said.
Mill levy rates for the fiscal year will drop from $15.91 for each $1,000 of assessed valuation of property to $15.56.
Public Works capital projects come to a proposed total of about $2.8 million for fiscal year 2019. This includes phase two of the U.S. 61 reconstruction project, from Second Street west to Sixth Street, which will cost about $1.6 million. It also includes $400,000 toward the top sealcoat and asphalt surfacing of city streets.
“We realize we are behind on our street maintenance, and the only way we are going to catch up is little by little,” said Varley. “So each year we take $100,000 from the general fund, or more if we can afford it, and transfer it in there for streets to try to play catch-up on it.
Varley said construction of the Amtrak passenger platform at the the Old Depot likely will occur near the end of fiscal 2019. Costs to the city should stay around $400,000, with funding coming from the hotel/motel tax revenue, the $6 million quality of life bond, a recently approved SIRCC grant, an Amtrak contribution and the remainder of an Iowa Department of Transportation grant.
In fiscal 2019, the city plans to use the remaining funds from the $6 million quality of life bond for a variety of projects, including $50,000 for the Amtrak project, $45,000 toward PORT trail projects and $92,760 toward an undetermined project at Riverview Park. Varley said an estimated $34,119 will remain in the ending fund balance for the bond.
Other changes in this year’s budget will be the combination of parks administration and parks maintenance into one entity and the replacement of two police department patrol vehicles.
According to Varley’s calculations, the general fund will sit around $5,611 at the end of fiscal 2019.