Marysville officials are evaluating first half of the year finances and already preparing for next year.
“Things are going well,” said Marysville Finance Director Justin Nahvi.
He explained that through the first half of the year, the city has seen about 55% of projected revenue. He said income tax, which accounts for the largest portion of the city revenue, is up over last year. He said business income tax is down about $90,000 from last year, but income tax from individuals is up about $100,000.
“When you think about it, that’s pretty good,” Nahvi said. “It’s not where we would like to be, but it’s pretty good for a city like us.”
He said city investment revenue is also “way up.” Nahvi said that rather than let city money sit in a savings account, he moves it to an interest baring account that also allows him to move the cash if needed.
Nahvi said he isn’t really concerned that some revenue has slowed. He said he doesn’t believe that is a sign of potential trouble.
“I think as long as we are hitting our overall revenue goal, we are fine,” Nahvi said.
While the city has revenue above expectations, expenses are well below expected. Through the first half of the year, the city has spent just 38.2% of the appropriated budget.
“Overall, we are doing very well on expenditures,” Nahvi said.
Based on city figures, Nahvi said he expects the city to spend about $1.7 million less than budgeted. He said the city has also spent less on safety services than budgeted.
Nahvi said revenue in the water and sewer funds is also up. He credited growth in the county, specifically Jerome Township. He said that when a new home hooks into city water and sewer, the homeowner pays a tap fee. The problem, he said, is that tap fee revenue is very unpredictable. Nahvi said the excess money is being put into a fund, “to use for construction of a new water treatment plant near the reservoir.”
He said discussions on that plant will begin in earnest later this year. He said city officials have vowed not to build the plant if it means they will need to raise rates.
Nahvi said he has run the figures and he believes the city can build the plant and continue operating without increasing rates for at least five years and potentially 10 years.
He said that is “great” given that many nearby communities are being forced to raise rates because they are tied into the Columbus water system.
In addition to exploring options on a potential water treatment facility, city officials have already started the budget process for 2020. Earlier this month, department heads submitted their initial budget requests. Nahvi said departments are being asked to keep next year’s operating costs in line with this years and to limit capital expense requests to “critical equipment and vehicles.” City officials will begin meeting about budget requests next month and a first rollout of the budget is expected at the September Finance Committee meeting.
Nahvi explained that a change at the state level will cost the city in 2021.
As part of the recently approved state budget, legislators decided not to consider stock or options as income for tax purposes.
Nahvi said he is working to explore exactly how much this change will cost the city.
He said Marysville is expected to see an additional almost $482,000 in revenue from the gas tax increase.
“I am confident that is going to be completely wiped out,” Nahvi said.