By Myrna Trauntvein
Nephi City is right on task as far as being ready to adopt the budget by June.
The council approved the tentative budget for 2019-2020 fiscal year and tentative amendments for budget 2018-2019 and set a public hearing for Tuesday, May 21 at 6:30 p.m. in council chambers.
“The budget proposal and the amendments for the past budget are on the city website,” said Seth Atkinson, city administrator.
“The budget on our website is extremely user friendly,” said Justin Seely, acting as mayor pro tempore.
Council members, Atkinson said, had listed the priorities they wanted considered in the budget.
The budget documents were the spot where “the rubber meets the road,” he said. The priorities of the council were matched with the expected revenues and those items which could be achieved with the money available were planned.
“Each year the city council reviews the outcomes from the prior fiscal year and turns their eyes toward the next one,” said Atkinson. “As the council identifies outcomes for the upcoming fiscal year, the staff can know how to allocate scarce resources.”
Nephi lost some of its sales tax because the Legislature determined that some of the tax should be used for homeless shelters in some populated counties.
“We have made one big change in the way our department managers will deal with utility costs,” said Atkinson.
Nephi City has a number of community-owned utilities. In past budgets, some of the utility costs for city departments have been absorbed by the utility or enterprise funds.
“In the Fiscal Year 2020 Budget, those costs have been budgeted in the appropriate departments,” he said.
In the upcoming fiscal year budget, the structural changes are reflected. For example, to assist the departments in the general fund with the additional costs, there have been increases to the contributions from the utility funds to the general fund.
“This allows all department managers to see and manage the costs of those utilities going forward and also increases transparency,” he said.
In order for department managers to more accurately track their costs and efficiently use their resources, the budget for the upcoming fiscal year contains new line items for utility costs.
Not only will the costs be more transparent, but managers will now be able to manage those costs the same way they do with other line items.
The utility funds will also see additional revenues from those city department utility payments. In order to facilitate city departments in taking on these costs, it was necessary to increase the dividend transfer amounts from the utility funds to the general service fund. The utility funds will also see an increase in the revenues they receive.
A table included on the city website: https://www.nephi.utah.gov/384/Budget-2019-20, shows the differences in the upcoming budget that have not been included in previous budgets.
“In addition, the Water and Sewer Fund has been split into two distinct enterprise funds,” said Atkinson. “It is better for the managers of the departments to see the actual cost of the utilities used by that department.”
“This required a lot of work to break out the departments,” said Nathan Memmott, council member.
Atkinson said that the thanks should go to all the staff for assisting in the preparation of the document, particularly the finance department, and to the city council for their community vision and priorities.
That breakout will promote conservation and, Atkinson said, it will also give the different departments incentive to manage utility costs.
“We put all the actual costs for the city office utilities on Lisa Brough’s account (as city recorder and finance director),” said Atkinson. “She will pay the utilities for the city office side of the building and the library budget will pay for the utilities used in that area.”
Contributions and Transfers amount to $335,308, he said.
The airport, $1,120; Cemeteries, $42,511; city recorder, $7,853; Golf Course, $52,064; Library, $7,851; Organized Recreation, $500; Parks, $56,113; Police, $7,297; Streets, $8,723; Swimming Pool, $11,357.
Subsidies were made to the golf course, $90,000 and swimming pool, $50,000 for a total of $335,389. The recreation department manager will oversee those.
Utility Funds Revenues: Natural Gas, $19,970; Water, $105,485; Solid Waste, $19,464; Electricity, $171,358; Sewer, $693 for a total of $316,970.
Expenses Dividend Transfers, $335,398. Dividend Transfers increased from 5 percent to 8 percent.
Utility Costs: Water, $106,876; Sewer, $6,220; Electric, $10,754; Natural Gas, $10,361. Less: Natural Gas Subsidy -$90,000 and Water Subsidy -$50,000 for a Total: $329,609.
The Budget Document contains the financial plan for 2020 fiscal year (July 1 to June 30). The budget outlines operational, capital improvement, and project priorities for Nephi City.
Nephi City has seen many changes over the last few years.
“New housing development has been on the rise and indications are that it will continue,” said Atkinson. “Due to this anticipated growth, the city has embarked in a number of projects that update/upgrade the city’s infrastructure.”
These projects include the expansion of the city’s water system, a new substation and a secondary natural gas line connection.
The city has also updated its fee structures and instituted impact fees to help fund these growth-related projects.
“Last year the residents of Nephi City voted in a Parks, Arts, and Recreation (PAR) Tax,” he said. “This tax will assist with funding for several recreation outcomes from prior years.”
Projects include a soccer field complex, a recreation center and improvements at Orgill Fields.