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Council approves mid-year financial report for 2018

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The City Council heard a mid-year report on the state of the city's finances at their Monday, May 14, meeting.

Finance Director and City Clerk Melody Salter presented the report, including data from the beginning of the fiscal year on Oct. 1 to the halfway point, March 31, to Council members during a special finance meeting. Salter described the report as "cautiously optimistic" when the full City Council later voted to accept the report, and Ward 3 Representative Walter Jones called it "very good news on all fronts."

Highlights from the report include that the city has brought in $4.91 million in ad valorem property tax so far this year, putting it at 97.88 percent of the anticipated budget for the first half of the year. Salter's report noted that $177,400 in property tax collection would make up the small budgetary gap.

“You’re going to be flush for the mid-year,” Salter said, noting that property and business license taxes are collected early in the year.  “While it looks great … of course that number’s not going to hold.”  

Salter also noted a jump from $23.8 million in total sales tax revenue in the 2016 fiscal year to $30.3 million in FY2017, divided between the general fund, Board of Education and capital projects. Salter attributed this to the addition of a one-cent sales tax approved in 2016, which only went into effect mid-way through the fiscal year. The sales tax revenue is anticipated to be higher this year since collection at the new rate has been ongoing.

Homewood's general fund assets as of March 31 totaled at just under $41 million, with $7.9 million in liabilities.

The report included the city's investments, such as an $11 million cash reserve account that has seen a 1.2 percent yield, and Salter said Iberia Bank and Bryant Bank will both bump yields on some of the city's accounts up from 0.35 percent to 0.55 percent. The total balance across the city's accounts is $115.7 million.

The debt service fund includes only $4.9 million right now, compared to $7.5 million at the same point last year, but Salter said there is $4 million in another city account that is scheduled to be transferred to debt services. The capital projects fund currently has just under $4 million in it, as well.

After bills that have been paid so far on the school system growth and parks projects, the city's 2016 bond fund sits at $98.7 million as of March 31. 

The city's general fund sits at a $410,000 surplus, Salter said, after $350,000 was used to pay employee bonuses and $500,000 moved to capital projects.

Salter's report also provided an in-depth comparison of how every city fund's revenue and expenses compare both with March 2017 and with the same halfway point in the last fiscal year. In the general fund, for example, revenue increased by $2.9 million to $30.2 million in comparing the 2017 mid-year report to the 2018 report, but expenses also increased by $2.5 million to $25.1 million total.

The debt service fund, on the other hand, is about $2.4 million lower than at the halfway point last year, while expenditures are up from $1.9 million to $5.3 million. Both revenue and expenditures have dipped by less than $1 million in the capital projects fund from the 2017 mid-year report to the present.

Salter also presented the Council with information on the variance between the city's budgeted line items so far this year and how actual spending has lined up with projections.

Salter said she is hoping for about $2 million in extra sales tax revenue above projections this year, which can be used as a cushion for debt service or other projects. She also reminded Council members to remember that some money that is still technically in the budget has been committed to projects such as sidewalks and road work, and to be careful when committing to additional expenses.

The Council voted unanimously to accept the mid-year report.

Additionally, Mayor Scott McBrayer said tonight that he is continuing to work on options to preserve trolley tracks uncovered during a spring repaving project on Broadway Street.

The bricks and former tracks have been exposed for about a month, and the city halted repaving to see if there were affordable options to preserve the slice of Homewood history. McBrayer said he is still waiting on cost estimates but is considering preserving a section of the tracks and interior bricks along Broadway for the public to see, but paving over the bricks outside the tracks, which are in worse condition.

The Council also:

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