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Posted: July 5, 2009 12:30 a.m.

Covington passes $120M budget

Budget down by $13 million

The City of Covington didn’t face a budget crisis like Newton County, but it did share in the new experience of having to significantly cut back expenses after years of burgeoning growth.

The city council approved a $120 million budget on June 13, nearly $13 million smaller than last year. Payroll/Benefits Manager Nancy Harvill said the recession helped the budgeting process in some ways, because it forced many departments to look at ways to cut the budget for the first time in years, as opposed to simply maintaining the status quo.

Declining Revenues

The city’s revenues are expected to decline by $12.8 million to $120,544,686.06, fueled mainly by a nearly $6 million decline in gas sales and a $2.56 million decline in electricity sales. However, those declines will be met by equal cost savings for the city, as the price of electricity and natural gas drop. Utilities Director Bill Meecham said because of declining growth, Covington is not budgeting for any major electrical or gas service expansions.

City Manager Steve Horton said the city’s prices won’t change, because they reflect the cost of maintaining

the utility systems, but the Power Cost Adjustment charge, or the cost of the gas and electricity on the market, will decrease for customers because those are passed on directly to the customer by the city.

The city is also expecting to collect $900,000 less in sales tax and $707,897 less in property taxes, because of a shrunken economy and lower residential property values. Also related to slowing growth are drastic declines in water and sewer tap fees. Both are expected to be down by 85 percent in FY2010 and represent a combined decline of $1,445,000.

 

Cutting Back

Because of the declining revenues, the city reduced expenditures by $12.7 million from last year. No employees were cut, but several personnel-related items were reduced, including the removal of 11 vacant positions from the budget, which will save about $400,000 in salary and benefits, said Ronnie Cowan, director of administrative services.

Cowan said the city made many reductions in scheduled overtime, overtime hours that are normally built into a person’s schedule due to particularly long shifts, like public safety workers, or on-call time like utilities’ workers. Total net cuts to overtime added up to around $324,000.

Firefighters received the biggest reduction in overtime at $142,000, but it was joined with a similar raise in normal wages. Cowan said the city was changing the fire department’s pay structure to a system that it felt more comfortable with, which has less overtime.

Covington also reduced annual step raises for employees from five percent to two and a half percent, reduced or eliminated uniform allowances for some positions and reduced tuition assistance for employees attending college by 50 percent.

"They cut the heck out of uniforms," Councilman John Howard said at a May 11 budget meeting.

Howard was also impressed by the lack of vehicles in the budget. Interim Financial Director Leigh Anne Knight said only one vehicle was included this year; $17,000 for the Storm Water department. A total of $707,817 was budgeted for vehicles last year.

Police Chief Stacey Cotton said the city will no longer continue the D.A.R.E. program, because it didn’t make economic sense this year. No alternate program is being planned by the city for FY2010.

Despite the cuts, there are a handful of new positions and projects scheduled for FY2010.

Mayor and Council Pay Raises

No employee base pay reductions or increases were scheduled, but the mayor and council will vote on pay raises for themselves. The mayor currently makes $12,000 per year and each council member makes $6,000. If the council approves raises, then those salaries will increase to $18,000 for the mayor and $9,000 for each council member.

These raises were considered earlier this year at the request of Cowan, who said that the mayor and council had not had any pay increase since 1977 when the budget was only a fraction of today’s size at $7.9 million.

Mayor Kim Carter said it’s awkward for politicians to vote for a raise for themselves, but that is the requirement of state law. She said that council members will vote on a raise before this year’s election, which would take effect on January 1. This way the members are not necessarily voting for increases for themselves, but for future city administrators.

"So, even if it’s awkward for the elected officials and unpopular with some segments of the populace, we must act based on what we believe to be fair compensation for those who will perform these jobs for years to come," Carter said.

Carter said that even though elected officials don’t run for office because of the salary, $24,000 in raises is a small consideration considering the size of the budget and amount of work members do.

Councilman Keith Dalton said raises are rarely appropriate and especially not so in this current economy.

"The only way this would be a worse time to give a pay raise is if this was Great Depression," Dalton said. "People are hurting and losing their jobs; the school system is hurting. It just could not be a worse time. It’s just not right; it’s akin to me eating a steak every day and my son eating a hot dog."

Councilman John Howard agreed with Dalton, but he said the raises will be voted on by the council at a later time. In February, council members Janet Goodman, Mike Whatley and Hawnethia Williams said raises should at least be considered.

New Employees?

Two new positions have been budgeted and will also be voted on by the council at a later date. One is a Community/Economic Development Director which is going to focus on both community development -- focusing on addressing poverty and improving housing -- and economic development by helping existing industry and bringing in new industry.

Councilmembers Keith Dalton and John Howard have said they feel the position duplicates the duties of The Covington/Newton County Chamber of Commerce, but Carter said the position will serve in a supportive capacity to the chamber and MainStreet Covington.

The other position is a Financial Coordinator position, which would oversee the Neighborhood Stabilization Program and handle those funds. City Manager Steve Horton said the city has a small accounting/finance staff, so another position would be helpful to specifically handle NSP and future housing monies. Howard said he didn’t think the position should be permanent until the city knew it was needed.

Former City Clerk John Grotheer served in the position on an interim basis earlier this year to get the NSP program up and running, before moving on to take a position with another city, Horton said. Cowan said the Financial Coordinator position is actually a transformation of the Grant Writer/ Project Manager position that the city had in last year’s budget but did not fill.

Cowan said an official description has not been written for either position, and probably won’t be until they are voted on by the council.

Next Year’s Big Projects

Although many capital purchases like vehicles and other equipment have been taken out of the FY2010 budget, some large projects remain.

• The city has budgeted $750,000 for the previously planned Joint Emergency Services Training Center. The center is supposed to be a 50-50 joint project between the county and city and would be centered on a burn building and a training tower. Newton County Fire Chief Mike Satterfield said previously that the training tower would be four stories tall and would be used for a variety of training scenarios including the use of ladders, rope rescues and search and rescue. Satterfield said there would likely be a maze with artificial smoke set up in the tower that firefighters could crawl through.

The burn building would be used to set fires that firefighters could then practice extinguishing. In addition to the burn building and training tower, the site would also likely include a training classroom, a paved driving course for the training of fire truck drivers and a draft area for the testing of water pumps.

• Covington has $880,220 budgeted for street projects, including a roundabout at the intersection of Turner Lake Road and Clark Street. In an earlier interview, Horton said a lot of accidents occur when drivers try to turn left onto Clark Street. Because roundabouts don’t allow for pedestrian crossings, an underground pedestrian tunnel will also be built. Covington will advertise the expected $900,000 bid around the middle of the year. A state grant will pay for $175,000 of the project, with the special project local option sales tax paying for the rest.

• There is also more than $1 million set aside for several storm water projects and $2.6 million in water/sewer projects, including relocating pipes along Ga. Highway 142 because of Georgia Department of Transportation’s expansion work there.

• About $6.4 million worth of projects is budgeted for the airport, but most of these will be paid for by the state and federal governments.

• $178,000 has been set aside to create and improve fiber and cable connections between county and city buildings.

• The city has included smaller amounts of money to carry out parts of their recently passed Urban Redevelopment Plan and Economic Development Strategy.

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