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MINUTES <br />CITY COUNCIL <br />NOVEMRER 25, 1998 <br />of those expenditures. Scalze stated that if the City does not have the <br />dollars then some of the frills must be cut. <br />LaValle pointed out that if the City were faced with a large capital <br />improvement expenditure, then it would bond for it. <br />The City Administrator pointed out that if an improvement is bonded for, <br />the City pays interest on the principai. For this reason, the Administrator <br />stated that his recommendation would be not to bond for an improvement <br />if there is an alternative source of funding. The Administrator indicated <br />that he did not have a concern with using future debt levy reduction <br />amounts to balance the 1999 Budget, nor did he have a concern with using <br />the 1998 budget surplus. Ultimately, these are the same sources of money. <br />However, an ongoing source of fundin~ will need to be identified to <br />balance the budget or else expenses must be cut and/or revenues increased. <br />LaValle suggested that the general fund surplus is used to balance the <br />1999 Budget and that the decision on how the debt levy reduction will be <br />used be delayed until the Council has the recommendation from the Debt <br />Levy Reduction Committee. <br />The City Administrator pointed out that there may not be a budget surplus <br />in future years, and without that surplus, the City would have to reduce <br />spending, increase revenues, or raise taxes to make up the approximately <br />$70,000 shortfall. <br />Scalze pointed out that the surplus can be used for the 1999 Budget and <br />the Council can wait for a recommendation from the Committee. The City <br />does not need to use debt levy reduction monies this year. <br />Morelan pointed out that the $70,000 will have to be made up each year. <br />The City will be spending $70,000 more than it is taking in in 1999 as weli <br />as future years. <br />Fahey agreed that the General Fund surplus should be used to offset the <br />$70,000 in the 1999 Budget and that the Council wait for the Committee <br />recommendation on the debt levy reduction. <br />Morelan a~reed that this would work, but felt it was a shortsi~hted <br />solution to a larger problem. <br />The City Administrator pointed out that tbe other options he has outlined <br />will be available next year. The use of the General Fund surplus will <br />impact the Capital Improvement Budget, but that issue can be addressed <br />next year as well. <br />