As annual retreats go, the Fayetteville City Council Retreat Jan. 26 provided documentation in extraordinary detail. The 352-page document, from which most of the retreat was fashioned, centered on multiple aspects of city government and is accessible on the city’s Web site.

The retreat agenda included all areas of city finances and other topcis such as the Local Option Sales Tax, Main Street and Downtown Development Authority issues, reports on water, sewer and stormwater, the city Comprehensive Plan Update, an overview of legislative positions taken by Georgia Municipal Association, issues relating to the Atlanta Regional Commission and a review of 2005 goals and consideration for goals and an action plan for 2006.

Director of Finance and Administrative Services Lynn Robinson gave a detailed view of city financial trends and a five-year financial forecast. She presented a fiscal year-to-date budget comparison and reviewed workload indicators.

Robinson divided the financial analysis and planning report based on historical trends, year-to-date financial comparisons and long-term forecasts. She said the city has experienced a decrease in property taxes since 1996, though a 2.3 percent increase was realized in 2004-2005 due to the city holding the line on the millage rate.

“Property tax revenues have decreased from 21 percent of the total revenues in 1996 to 18.56 percent in fiscal year 2005,” Robinson said. “This is due primarily to a strategic decision by the mayor and city council to reduce the millage rate over this period of time. Due to sound financial practices the city has been able to lower or keep the millage rate the same since FY 1993, when the millage rate was 5.98 mills.”

Robinson said the Local Option Sales Tax increased from 1996-1999 but has leveled off. There has been a slight increase in the city’s Occupational Tax while other revenue sources have held the line, she said. Reporting on ad valorem digest growth, Robinson said, “The highest growth years are behind us.” She said the city has a projected long-term growth in the seven percent range. The millage rate has continued to decrease or remain the same in recent years, she added, having decreased consistently from 5.05 mills in 1996 to 3.033 mills since 2003.

Regarding the city’s Unrestricted Fund Balance, Robinson said the balance has been decreasing since 1998 when it reached nearly $1.7 million. The 2005 fund balance was less than $100,000. The city can no longer rely on the fund balance to balance the budget, she said. And relating to the General Fund, Robinson said the city’s population has increased at a higher rate than per capita expenses. Population during the past 10 years has increased 5.52 percent while per capita expenditures increased 4.61 percent. The city has been effective at providing services while holding down costs, Robinson said.

In terms of the long-term financial forecast, Robinson provided several assumptions relating to city revenues. She projected a 7.5 percent annual increase in LOST and digest taxes, a 7.0 percent annual increase in Occupational Taxes and a 5.0 percent annual increase in both Franchise Taxes and Fines and Forfeitures. Regarding expenditure assumptions, capital outlays are projected to include replacement items only while operating expenditures should see only a 2.0 percent increase. Robinson said personnel expenditures are anticipated to see a 3.0 percent increase in 2006, a 3.5 percent increase in 2007, 4.0 percent in 2008, 4.5 percent in 2009 and 2010. Public Safety departments have requested a number of new personnel positions through 2010 but, said Robinson, no adequate way to fund those positions has been realized.

Among the forecast issues facing the city is the need for evaluation of user fees for Water and Sewer and the control of debt services in all areas, Robinson said. FY 2006 Water and Sewer Fund expenses are $17,548,235 with a change in net asset before depreciation of $17,702, she said. Depreciation expense for FY 2006 is budgeted at $1,408,000. The water expenses are 12.3 percent of the total Water and Sewer Fund and the sewer expenses represent 84.77 percent of total expenses. FY 2007 through FY 2010 have additional expenses that include new personnel for the expanded Water Pollution Control Plant and an additional maintenance crew for the newly established stormwater drainage system utility. Operating/maintenance expenses, Robinson said, are projected to increase at an estimated 2.0 percent annually to cover inflation costs.

“Depreciation expense indicates an increase from $920,000 in FY 2005 to $1,408,000 beginning with FY 2006 through Fy 2010 to reflect the addition of the Water Pollution Control Plant expansion, stormwater drainage system infrastructure and other additional assets to the fund,” Robinson told the council. “The reserved 2003 revenue bond fund balance and unreserved fund balance is for capital projects, which include replacement of vehicles and equipment, the mapping system project, the pollution control plant and construction of stormwater drainage infrastructure for FY 2009-2010. The Water Reservoir proposed for FY 2009 shows being totally funded by a recommended additional issue of revenue bonds in the amount of $8,200,000. This increased debt will require additional user fees through rate increases and/or additional installation fees.”

Other retreat topics filled the day-long retreat. Main Street Director Nancy Price provided council members with the organization’s first annual report and Planning & Zoning Director Eldridge Gunn updated the council on the city’s Comprehensive Plan Update and the public process that will occur in coming months. And Mayor Kenneth Steele provided on overview of Georgia Municipal Association legislative priorities along with issues pertaining to the work of Atlanta Regional Commission. A list of 2006 goals is currently being compiled and will be available soon.

A complete listing of the 352 pages of information and documentation presented at the 2006 retreat can be obtained by accessing the Meetings, Agendas and Minutes section under the Mayor and City Council heading at www.fayetteville-ga-us.org.

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