November 21, 2012 - Crestwood's draft 2013 budget is "optimistic at best," according to Ward 2 Alderman Tim Trueblood.
The Ward 2 alderman told the board during a recent work session the draft budget indicates Crestwood will receive revenue it is "not hitting now." The city has year-to-date sales-tax revenue of $4.5 million, as of the third-quarter financial report, with $5.8 million budgeted.
The draft 2013 budget projects roughly $5.9 million in sales-tax revenues.
"I see nothing down the trail that's going to provide for that," Trueblood said. "... and right now, if that's what the board puts before us, I would say, 'No, I'm not comfortable with it.' Not because I don't think it's a good figure they've obviously tried to reach. I just don't see it happening."
The 2013 draft budget estimates total revenues of $12,765,592, with $5,893,342 in expected sales tax, and expenditures of $12,761,916, for a surplus of $3,676. The budget also includes a 1-percent, merit-based pay raise for employees, which was recommended by the Ways and Means Committee, but has not yet been approved by the board.
Ward 3 Alderman Jerry Miguel expressed concern about the budget's assumption new businesses in Crestwood, such as Culver's, will open Jan. 1 and "are off and running full speed on that date."
"When you're opening a new business ... you don't start full speed ahead," he said.
Miguel also noted if businesses would open in January, the city will not see the revenue until March at the earliest.
"I would say that at best, (what) we can hope for is nine months (of revenue), and that's if all the stores (are) opening as projected, and they realize the maximum, that maximum potential, in that first year," he said.
Trueblood said the projected figures are what he hopes the city would receive, but he does not believe the economy will "provide that type of income."
"I see nothing online right now in the way of new businesses that can produce the projected income for the reasons Alderman Miguel stated, which is basically that's a year-long projection of revenue," Trueblood said.
Ward 2 Alderman Bob Deutschmann asked if the city has a contingency plan in place, to which Mayor Jeff Schlink said there is not a contingency plan, but the city adapts "to the changes in the revenue stream" in cooperation with department heads.
"The estimate that we're putting together is simply that. It's an estimate," Schlink said, "and if we were to not have the revenue that we have, then we'd have to cut expenses during the year ..."
Suggestions were also made to reduce the salaries for the city administrator and director of public services positions.
Fire Chief Karl Kestler currently serves as acting city administrator due to city officials reaching a separation agreement earlier this year with then-City Administrator Petree Eastman. Director of Public Services Jim Eckrich recently announced his resignation, which will be effective Nov. 28.
Miguel said he would like to see the city administrator salary for 2013 reduced to $90,000 from $98,000.
However, Schlink said there is a difference between the budgeted amount and the amount negotiated with the city administrator.
"Those can be two completely different figures. If you cap it at $90,000 then that is the max we would be able to do without action on the board when we're talking to the new city administrator negotiating salaries," Schlink said. "If you leave it the way that it is, you can still have your objective of $90,000, but you don't have to do as much work if it was to go over $90,000 would be one way to look at it."
Ward 3 Alderman Paul Duchild, who serves on the City Administrator Candidate Search Committee, said salary has not been discussed yet by the committee, but it will be "something to consider" at the next meeting. Duchild also said he is not willing to move the salary at this point, but he does not see it going much higher.
With Eckrich leaving Crestwood to take the director of public works/city engineer position in Chesterfield, Duchild suggested lowering that position's salary by $20,000 to get it within "the market rate of a public services director."
Ward 1 Alderman Darryl Wallach said he agrees the director of public services salary needs to be reviewed, but he is not comfortable with the decrease Duchild suggested.
"I do think we need to do comparables as to what we really want, whether we want an engineer for that position or someone else," Wallach said.
Duchild also noted a vehicle that goes with the city's public services director position, which he recommended either be incorporated into the city's fleet or sold.
Miguel also suggested a reserve fund be created to "give some meaning to putting monies into reserve." The only stipulation Miguel had for a potential reserve fund is that applying the funds has to be done "through approval of the board."
"My concern is that over time those funds are going to just be forgotten about and eventually they'll be disregarded or misused," he said.
Miguel also said he would prefer a separate bank account be opened, but it "wouldn't be absolutely necessary for that to happen."
Finance Officer Greg Kremer said he would recommend against opening a separate bank account because doing so would increase costs to the city.
"I do understand your thought, and I agree with that," Kremer said. "I guess my only other comment is the money that has been set aside thus far in reserve, that, to my recollection, has already been passed by ordinance, so those funds could not be spent unless the board approved that because it is part of the budget. The budget passed by ordinance."
The finance officer also said adding an extra column to the budget summary makes sense and can be done, and amounts set in reserves can be footnoted properly.
No action was taken at the work session.