BELLA VISTA -- The Bella Vista City Council closed out 2021 by unanimously voting to approve a new budget for 2022.
The council's final regular meeting of the year was held Dec. 13 at the Bella Vista Court Room. With Mayor Peter Christie absent due to illness, the meeting was presided over by Doug Fowler, who is mayor pro tem.
As for the new budget for the upcoming year, Fowler said, "As far as the general operating expenditures, we're expecting revenue for 2022 to be in the range of $17.5 million. Our general operating expenditures are expected to be about $17.2 million. So we're expecting revenues around about $300,000 greater than what our operating expenses are going to be today."
Fowler said he personally thinks "our revenue projections might be a little low versus what we will actually realize," but added that it is "probably prudent, in today's environment, to be a little bit cautious."
For example, he said, "We have the county contribution for Bella Vista that's been taken down, and I know that's going to impact our revenue from the county perspective. And then because of the state of the economy and the inflation that's taking place, you never know what's going to unfold in front of you. You certainly don't want to lean out too far over your skis and expect that revenue is going to come in that, in fact, may not."
He also pointed out that one situation in the budget may be showing a shortfall which, in all likelihood, will never materialize.
"With our street fund revenue we're projecting about $3 million into the city for 2022 with expenditures of $3.9 million, so that's an underfund of about $938,000," he said. "But this is something we experience every year. Generally what happens with these shortfalls in expenditures for the Street Department is that we fund that from our general revenue."
He continued, "We fund our city 100%. Assuming all departments will stay at a full head count, that they're going to spend everything they projected they were going to on operating expenses ... in the five years I've been here that has not happened yet. So we generally have an overage of revenue versus expenditures every year. And even if that would not happen, we have a pretty healthy reserve, so we're always able to sufficiently fund that street fund."
Fowler listed good news on the insurance and debt service fronts as important highlights heading into the new budget.
"Our city, with the help of our HR director, experienced no medical insurance increases, and dental insurance was no increase either," he said. "Workman's compensation did show an increase of $27,000, but our debt service actually decreased from $355,000 to $98,000 due to a payoff of an equipment loan."
And, he said, "Fire continues to be the greatest expense to the residents of Bella Vista. I'll say it's a very outstanding Fire Department. And the Police Department is our No. 2 expenditure. They're very professional, very well-staffed and very well-equipped. I'm very glad they're here. And our third greatest expense is our Community Development Department. I've worked with these people quite often ... I've got to say we have some outstanding people there in that department."
The budget vote came on the heels of the September 2021 financial report that was discussed earlier in the meeting.
"Our general revenue is up about $2 million year-to-date versus the prior year," Fowler noted in discussing the September report. "And that's not just attributed to sales tax from the city and state, but it's attributed to ambulance revenue, property taxes, etc. So we have real healthy taxes coming in to help us fund our city."
As for the city's expenditures to date, he said, "We're about $1.1 million under budget, and I excluded the capital projects because that's kind of a moving target -- we don't really know where that's going to land. More than likely we'll be under budget there as well because we probably won't spend everything."
He added, "We're in a very healthy position financially as far as the city is concerned."
The council also went through its annual exercise of approving (through a unanimous vote) a resolution authorizing budgetary funding transfers between departments in the 2021 annual city budget.
"This is a resolution we have to approve every year in case we have to transfer funds between different departments for everything to balance out so we can close the books," Fowler said. "Typically we don't have to do anything like this. This year we might have one item that we have to address."
Fowler was referring to the need to replace the HVAC system at the Bella Vista Public Library.
"From what I understand the HVAC system in the library went down, and we are going to need to replace it," he said. "The cost estimate on that is about $26,000, so we may have to move some money around this year to cover that."
Council member Jerry Snow replied, "I was under the impression the library building was still owned by the [Bella Vista Public Library] foundation. Is that not correct?"
Staff attorney Jason Kelley answered, "It is, and part of our lease agreement requires us to do all maintenance and upkeep, so it falls to us to take care of that."
The council advanced one ordinance to its third reading, which will take place during the January regular meeting. The item is an ordinance approving the vacation of drainage easement at 2 Riordan Road pursuant to section 107-37 of the Bella Vista city code upon conditions.
The council's next work session is set for Jan. 18 at 5:30 p.m. in the Bella Vista Court Room. Its next regular meeting is scheduled for Jan. 24 at 6:30 p.m. in the court room.