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Session 1919 <br />May 10, 2004 <br /> <br />and this year he recommended an increase in fees at close to five per cent, because in <br />the expenditure budget, he will show increased costs expected to incur which will justify <br />raising these fees. <br /> <br />Inter-Government Aid <br />The City Manager said the major revenue source is a variety of sales taxes. The <br />current budget reflects a downturn in the economy leveling off and increasing about this <br />time of the year. For next year he recommended continued increase of sales tax <br />revenue of close to five per cent. <br /> <br />Ms. Welsch asked if the drop in grant money was a reflection of TEA money, and was <br />advised it was federal grant money to improve the Olive Boulevard area which has been <br />used, and now the amount shown reflects the revenue source and expenditures for next <br />year. Each department seeks grants for additional funds. <br /> <br />Sales tax is dependent upon the economy, which is reflected in the budget. Gas prices <br />are likely to affect the economy. <br /> <br />Fire and parks do not go into the sales tax pool. All the others are per capita. Sales tax <br />is nearly seven and a fraction per cent; the City keeps one and a fraction per cent, <br />which is important to understanding the economic development policy. Four per cent <br />goes to the State, three per cent remains locally; of that three per cent, two per cent <br />goes into the tax pool, and less than one per cent goes directly to the city. <br /> <br />Future funding of City expenses; one sales tax of ¼ of one per cent could be collected <br />after a vote from the people. If tax funds are needed in the future, this is where the <br />revenue could be raised; a second option is voting on property tax, and mixed in with <br />that are increases in various fees and charges. Maximum has been reached on most of <br />these revenue sources. <br /> <br />Sundry Revenue <br /> <br />The biggest items are fines and court costs. These cannot be increased because they <br />are set by State law, but fines can be increased. There have been increases in fine <br />revenue and it has been recommended to increase standard fines, which has been <br />accomplished. <br /> <br />End of the General Fund <br /> <br />The budget will never reflect more in expenditures than in collected revenue; both sides <br />must be equal. Mr. Ollendorff advised the City Council to not budget more on the <br />expenditure side than existed on the revenue side. Adjustment can be made within the <br />budget, but the expenditure total cannot be changed, unless more revenue can be <br />raised to pay for it or unless some item is eliminated. <br /> Page 4 <br /> <br /> <br />