Gainesville City Council will meet today to discuss its goals and priorities for the upcoming budget year.
In a meeting that begins at 9 a.m. at the Fair Street Neighborhood Center, the City Council will hunker down for more than half the day to hear city officials’ revenue projections for the upcoming budget year.
Today’s retreat will kick-start planning for the city’s 2011 budget year, which begins July 1 and ends June 30, 2011, City Manager Kip Padgett said.
Historically, these planning retreats have provided revenue projections for City Council members to consider as they begin the process of shaping the government’s spending plan for the upcoming fiscal year.
For the past two years, city officials have had to adjust to a new normal, one in which sales tax revenues consistently come in below projections and there is hardly any new revenue from development.
People spent less, and city sales tax revenues plummeted. A market for new construction virtually disappeared, and the city’s revenues from increased property values and building permits did, too.
Businesses closed and the city collected less occupational tax. The stock market slumped, and the tax the city collects from investments and stock sales, intangible tax, did not even amount to $200,000 between July 2008 and June 30, 2009.
Franchise fees, or taxes that utilities that operate in the city limits pay based on their revenues from in-city customers, also declined in 2009.
This year’s retreat comes a little more than halfway through fiscal year 2010 when sales tax revenues have continued to stay low, and another uncertainty in revenue — this year’s reassessment of property values in Hall County — emerges. In fiscal year 2009, property tax revenues were the only revenue stream that grew, albeit only slightly.
To deal with revenue losses in the past, city officials have cut down on capital spending and instituted hiring freezes. Current city employees already face once-monthly furloughs, and others have been laid off to deal with dwindling resources.