City Manager John Glascock thinks his original estimate of the amount of sales tax the city will receive in the next fiscal year is off — by a lot.
When Glascock went public with his proposed budget for fiscal 2020 in late July, he was projecting a 1.75% decline in sales tax revenue from this year. That would mean a drop of $813,205.
During a Monday budget work session with the Columbia City Council, however, Glascock said sales tax numbers through August suggest a better and safer estimate would be a decline of 2.5%. That’s another $319,563 the city wouldn’t have to work with.
Changing the budget would mean revising revenue estimates for all the city’s sales taxes, including the general sales tax and those for parks, transportation and capital projects.
The grim sales tax projections and strategies for improving the city’s bus system guided much of the discussion at the work session, where Glascock and the council discussed several possible budget amendments.
Overall, Glascock’s initial budget anticipated $455 million in revenue and $484 million in spending, and it focused on improving employee salaries to boost morale and combat high rates of turnover. The council will already have to rely on reserves to fully fund the 2020 budget, which will take effect Oct. 1.
In fiscal 2018, the city received $23.8 million* in general fund sales tax revenue, and the projection for fiscal 2019 sales tax stands at $22.7 million. The fiscal 2018 number, however, includes a late supplemental payment from the state that should have been received in fiscal 2017. After removing that amount to gain an “apples to apples” comparison, the projected decline in sales tax revenue comes out to 2.37%, Glascock said in a presentation to the council.
The council decided for now to amend the budget to reflect a decline of 2.5% and to revisit the issue in January when numbers for the rest of the calendar year are available. Fifth Ward Councilman Matt Pitzer and Mayor Brian Treece, however, said a 2.5% projected decline is too conservative.
Last year, Pitzer persuaded the council to revise former City Manager Mike Matthes’ prediction of a 2% sales tax revenue drop to 1%, according to previous Missourian reporting. That move gave the council, on paper, an additional $459,000 to work with in the general fund, which pays for the day-to-day operations of city government.
Budget officer Laura Peveler said the estimate for fiscal 2020 is a “way better estimate than last year” because the Finance Department refined its process and because the late supplemental payment from the state that should have been received in September 2017 instead came in December 2017, skewing the fiscal 2018 revenue numbers.
After presenting his budget at the last Monday's Columbia City Council meeting, Glascock said the public needs to decide what its priorities will be. Several people testified at the meeting that public transit should be the priority.
Glascock and the council spent much of the discussion Monday outlining options to address the bus system and paratransit service for people with disabilities. Both services have frustrated riders for years. Glascock presented potential solutions for each service that seek to address complaints.
Glascock believes the most beneficial approach for the Go COMO bus system would be to decrease wait times rather than add routes to expand an “already bad service.” He suggested adding one bus and two daily drivers to each route, which would cut wait times from 45 minutes to 22 minutes at a cost of nearly $2 million for personnel, fuel and maintenance.
Fourth Ward Councilman Ian Thomas got little traction with his idea to charge for parking at Columbia Regional Airport, lower the airport’s subsidy from the transportation sales tax and invest the money in transit. Like last year, he’s calling for a $3 parking fee that would generate $262,800 a year for transit.
Thomas’ plan, however, doesn’t account for a $5 parking fee the city plans to implement in fiscal 2022 to help pay for a new airport terminal. The council discussed whether the parking fee should be increased to $8 in 2022 or remain at $5 and whether any money from an immediate parking fee should be put in a reserve for transit.
Treece believes fewer people would use the airport if the city charged for parking. Only Third Ward Councilman Karl Skala supported Thomas’ idea.
The council ultimately decided to vote on the issue after a public hearing at its Sept. 3 meeting.
Glascock also calculated the cost of a plan that came up at the Aug. 19 meeting to add back an hour of evening bus service per day, which the council eliminated last year. Bringing it back would cost the city $501,544. Most council members opposed that because of the cost in overtime pay.
Thomas also floated the idea of establishing a transit authority that would include input from MU to help accommodate the needs of students, who mostly use private shuttle services to get to campus.
“Every college town that has a good transit service has the kind of partnership that we don’t have,” Thomas said, adding that he has met with MU Chancellor Alexander Cartwright to discuss a potential partnership.
The budget presentation also highlighted paratransit concerns. Paratransit users have faced longer wait times because of an increase in ridership since fixed routes were reduced in June.
Glascock presented two ideas: reducing the paratransit service area to the federal requirement of three-quarters of a mile from fixed route lines or adding a paratransit van that would provide 30 to 36 more daily rides and cost $208,733. Raising paratransit fares from $2 to $3 would help offset the cost of the new van. The council decided to go with the latter suggestion.
The Career Awareness Related Experience program was another major topic of conversation. Glascock’s budget recommends eliminating the CARE Art Gallery program and reducing the summer CARE program by 56 trainees and 5½ job coaches.
Thomas and First Ward Councilman Clyde Ruffin oppose cutting the program and asked that the issue be revisited.
The public will be able to give feedback on the budget at regular City Council meetings Sept. 3 and Sept. 16.
Supervising editor is Scott Swafford.