City Manager Daniel Valenzuela outlined a new process for the City’s budget to open the City Council’s first budget workshop Wednesday at City Hall.
Valenzeula said Wednesday’s meeting was intended to be an initial, introductory meeting.
He said that in the past the council has been limited in the number of workshops on the budget. Previously they were limited to one at the strategic planning workshop which would normally be around May or June.
“This one actually I would like to start off early to really address some of the needs the city has. And I will ask the City Council to entertain the opportunity for the city to have a couple more workshops before we actually start talking strategic and even budget.” Valenzuela said.
“I would like to see one in March and April as well at the end of the month.”
“Today is kind of like that initial meeting to kind of introduce to the Council some of the areas that myself, the directors, the assistant city managers would like you to review as far as potential for revenues, reduced expenditures, and even some of the efficiencies.”
Challenges Facing City
Valenzuela started off the meeting by highlighting some of the challenges the City faces.
First was the limitation recently put in place by the state legislature that limits to 3.5% the property revenues the city can collect.
Valenzuela apparently meant the 3.5% increase in property tax revenue the city could collect under Senate Bill 2.
If the city wants to set a tax rate that would increase by more than 3.5% the city has to submit that to the voters for approval.
Necessity of Economic Development Projects
The city’s tax revenue is dependent on property value growth, which brings added pressure to pursue economic development projects.
Valenzuela mentioned the current data center project and said the city may be looking at multiple data centers.
Municipal costs increase faster than the Consumer Price Index (CPI) and revenues received do not keep pace with inflation. The inflation rate for municipalities is around 1% higher than the normal CPI increase of 3%.
The legislature limits a city’s revenue increase to 3.5% whereas the inflation rate for the city is around 4%, Valenzuela said.
Staff has been directed to look at revenue through the budget process and see what can be done internally to grow the available revenue and reduce expenses. The areas they will be looking it are:
- Cost recovery – is the city recovering the true cost of services provided?
- Expanding grants, partnerships and lease revenue.
- Revenue potential not being utilized – is there any service we are provided we are not receiving a cost for?
- Underutilized city assets for which city could be receiving revenue.
- What are the service levels and delivery costs for those services?
- Are there services that should be contracted out at a lower cost?
- Are there services that should be eliminated?
- Focus on increasing efficiencies within departments.
The Council had a full day of presentations lined up. They were scheduled to hear from all the city’s department directors about the needs and the challenges of the City.
We will have more on those presentations for each city department as we continue to follow this story over the next few weeks and months.
1 Comment
You should do more homework on the health hazards associated with Data Centers. That is the last thing San Angelo needs. There are articles about water contamination and Data Centers cause health issues.