Despite a lower interest rate and an extended loan to finish the City Hall complex, sales tax revenues are still falling short of principal payments.
Finance Director Melanie Allwood told the Richmond Finance Committee last night, that in addition to finishing City Hall, the $1 million loan the city signed on for last year was meant to lower the payments on the complex. However the general fund is having to pull some of the load according to Allwood.
“We needed to get the loan payment as low as we could so the tax could cover the payment,” Allwood said. “If the sales tax goes up we can pay it off sooner, but right now we’re short every month.”
Councilman Roger Kepple said the city shouldn’t count on that money increasing.
“I think we need to realistically look at that sales tax not going up,” he said. “I think realistically every business person in this room agrees.”
Allwood said the city is still making progress on eliminating the deficit. She said the city has the figure down to around $38,000 in the red from more than $200,000 in last October.
“I don’t feel like we’re where we need to be but I do feel we are going in the right direction,” she said.
Councilman Jason Berning spoke up about some of the criticism the council took for extending the loan and said those problems were handed to them.
“Would anybody like to comment about who was on the council at that time?” Berning said. “We were handed that.”
Kepple and Councilman Jim Dunwoodie said they do not want to slam past councils but would like to get a handle on what happened and where they need to go forward.
“I appreciate Jason’s comments, but it doesn’t really matter,” Kepple said. “We have to work with what we have.”
“We don’t know what the situation that the council was in at the time,” Dunwoodie added.
“They didn’t know I don’t think,” Berning responded. “I think that was the problem.”
City Administrator Rick Childers said he thinks past councils were more optimistic about sales tax revenues coming in.
Councilman Tom Williams is the only current councilman that was on the council then. He said it’s much more complicated than a shortage of revenue.
“We cut a lot of things out but they were brought back in also,” Williams said. “Things were changed and places were added onto. After we agreed to what we thought was going to be done, things got changed in the middle.”
Williams said it was similar to approving budget adjustments. He said the council approved things that had already been approved by department heads. He said the final drawings had to be redrawn to add the 911-dispatch center to City Hall.