City ready for final reading of $245 million FY 2018 budget


By Gary Gray

Johnson City commissioners last week passed a second reading of the $245 million 2018 fiscal budget without discussion, including a matter deferred on first reading about whether the city’s golf financials should remain an enterprise fund or be moved into the general fund.

“At our last meeting, we pulled it from consideration in this budget,” Vice Mayor Jenny Brock said. “We are scheduling a workshop in a few weeks just to concentrate on golf and what we need to do.”

During first reading on June 1, Commissioner Ralph Van Brocklin expressed his concern that moving the golf fund into the large $63 million general fund could cause the financial reporting to become more obscure. Van Brocklin was not present at the second reading, but he told the News & Neighbor he remained concerned.

“My understanding is that when Buffalo Valley was purchased, the discussion was that golf needed to be self-supporting and that establishing golf as an enterprise fund was deemed the most appropriate way to ensure it would not take Parks and Recreation resources,” he said. “I am not sure if golf revenues have ever allowed it to be self-supporting. In the seven budgets that I have participated in as a commissioner, it certainly has not stood on its own, requiring yearly general fund transfers of $400,000 to $600,000 per year.”

An enterprise fund is designed to make money. However, that money — by state law — must go toward operational costs, in this case Pine Oaks and Buffalo Valley golf courses. This coming fiscal year, the courses are expected to pull in about $1.3 million, but expenses are projected to outweigh revenues. .

The general fund includes basic services, such as police, fire and public works, and some commissioners say it is a philosophical flaw to move the golf fund into a bigger pot.

Brock indicated at the first reading that since golf will never be self-supporting it does not make sense to continue it as an enterprise fund. She also indicated that to keep it as an enterprise fund opens it to more scrutiny than other recreational activities and that that is unfair.

“I am not at all clear what management’s motivation is to dispense with the golf enterprise fund and rolling revenue/expenses over into the general fund budget,” Van Brocklin said.

A third and final reading of the budget will take place at 7:30 a.m. on Monday in a special called meeting. This is standard operating procedure for the City Commission, and at this point a quorum normally gathers for a purely procedural vote to make sure the budget is wrapped up by June 30.

“Barring any unforeseen changes, we’ll have you out of here in 15 minutes,” City Manager Pete Peterson told commissioners.

The balanced budget includes several amendments that passed on second reading. The first is the addition of more than $531,000 to repair a deteriorating slope at Science Hill High School. About $105,000 also was added to the cost of a project for plumbing repairs in the Municipal & Safety Building’s detention facility.

No tax increase has been proposed. The municipal rate is set to stay at $1.87 per $100 of assessed value for those living in Washington County, $1.83 for those in Carter County and $1.89 for Sullivan County.

Total projected expenses are a 0.5 percent above the current year, though general fund revenue is budgeted at about $89 million, a more than $3 million increase over the current year. Property tax revenue is expected to increase by nearly 2 percent, and local option sales tax is showing strong growth this year with a nearly 4 percent hoped for in fiscal 2018.

Property taxes comprise 41 percent of revenues in the budget. Local sales taxes account for 24 percent of revenues.

Property tax revenues collected exclusively from properties located in Med Tech Park are designated as an economic development reserve in the general fund, with fiscal 2018 collections estimated at $545,000. In addition, $281,000 coming from the Tennessee Valley Authority as reimbursement on work at Boone Dam also will be designated for economic development.

More than $10 million is earmarked for Public Works’ continuing effort to build and renew infrastructure, including street resurfacing, completion of King Commons, upgrades at Knob Creek Road and Med Tech Parkway, the resurfacing of the Municipal & Safety Building, as well as a multitude of street, sidewalk and parking projects.

The city also will make its more than $8 million contribution this coming year to the new East Tennessee State University Fine and Performing Arts Center. Another $140,000 is budgeted for the city’s share of improvements at the Aerospace Park at Tri Cities Airport. The city is expected to contribute a total of $4 million to the park overall.

Several local leaders were recognized for their efforts at the June 15 meeting. Brock presented former mayors Steve Darden and Jeff Banyas with a proclamation honoring their involvement in the Tweetsie Trail.

Banyas called the venture “large and complex.”

“There were tough negotiations with the railroad to obtain land, and many hours went into construction,” he said. “I’m happy for the citizens and the city that we have this amenity.”

Darden, who headed the formation of the Tweetsie Trail Task Force, credited Assistant City Manager Charlie Stahl for his knowledge of the railroad and his help in working with Elizabethton officials for completion of the part of the trail in that city.

“When it’s all said and done, this project had more broad-based support in the community than anything I’ve seen,” Darden said.


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