Facing revenue decreases, the city of Powell is proposing dipping into reserves to fund a one-time obligation that’s been in the works for years, and to fill a hole created when state funding dropped.

“Revenues are down for the state, and everyone knows that and understands that,” said Powell City Administrator Zane Logan.

Revenue for the city dropped from a projected total of $8.46 million for the current fiscal year to an anticipated $6.4 million. By comparison, revenue was $6.93 million in fiscal year 2014-15.

Powell will not receive any consensus funding from the state, which typically is used for street maintenance and presents a $370,000 blow to the revenue stream. Meanwhile, sales tax revenue dropped by about $250,000 for the city — creating somewhere in the area of $570,000 to $600,000 in revenue cuts, Logan said.

The proposed budget for fiscal year 2016-17 estimates that it will cost $19.4 million to keep the gears turning for the city of Powell and its utilities. Although that may seem high, it’s down from last year’s $21 million.

Part of that change was because the 2015-16 budget had $1 million for a project involving Gluten Free Oats, Logan said.

For now, everything is preliminary and far from set in stone. The budget will not be official until it passes three readings with the Powell City Council next month, and each time will allow for public comments.

The big picture

Budgeting for a city is a lot like budgeting for a household — money will come in and go out between now and the end of the fiscal year, June 30, 2017, so numbers are merely projections at this point.

The city is set to receive $6.4 million and plans to spend $6.69 million for a loss of $291,719. In order to balance the budget, the city is planning on dipping into reserves for two projects plus the $64,000 in for the supplemental budget (see related story).

The first project to be funded by the reserves is in cooperation with the Wyoming Department of Transportation to remove the median on Coulter Avenue and make upgrades along the way. This project has been in the works for years, and the city is already obligated to it. But, the city’s share of the total cost is small — about 9.5 percent of the total cost, for roughly $130,000 out of Powell’s wallet.

The other project to be funded out of reserves is to prevent future high-dollar projects by doing slurry-seal road maintenance in the downtown area for $200,000.

“We are trying to have enough yardage to maintain the minimum,” said Public Works Director Gary Butts. “We knew what was coming, so we made sure to cover as much as we possibly could when the funding sources were drying up.”

This is the first year the state’s direct funding to cities, towns and counties ($105 million total) will be distributed in two payments. Powell’s total share is $530,000, but there is a chance that second payment could fall through, if the Legislature were to go into a special session and revise the state’s budget. In light of recent revisions to the state’s budget, cutting roughly 8 percent from all state agencies on top of past cuts, this could happen and the city council is keeping that possibility in mind.

“I would be doubtful they would do that,” Logan said, estimating an 8 percent cut would amount to a $20,000 to $25,000 cut for Powell. “It is not insignificant,” he said.

Although the city is relying on reserves to fill the gaps, the reserve account is set to remain close to the $3 million mark, about where it was a year ago, and well above where it was in 2010, at just barely $1 million.

“There is nothing that says we have to stay at $3 million,” Logan said.

Had the city kept spending like it was, the reserve account would be in the negative, said Powell Mayor Don Hillman.

“That is an $800,000 turnaround per year and that is fantastic,” Hillman said.

How it will be funded

Overall, the city’s assessed valuation increased in the last year to an estimated $42.73 million, compared to last year’s $40.58 million. Levied and collected taxes in fiscal year 2016-17 will be $213,687 compared to the previous fiscal year’s $196,301 on the valuation of all taxable property.

The city levies 8 mills, but 3 mills are levied by the local fire district so the net is 5 mills for the city.

Revenues are anticipated to decrease from $8.46 million last year to $6.4 million. As of March 31, the city received $5.9 million.

Sales tax from the state is set to drop from $2.3 million to $1.99 million.

“Once you go through the budget, it is doable,” Logan said. “There is no magic there; the city of Powell is no different from anyone else. I appreciate the effort from all the department heads.”

The graphic to the right is a breakdown of Powell’s proposed budget. 

No COLA for city employees

The budget does not have cost-of-living increases proposed for the city’s employees, but it does factor in potential raises based on merit. This varies from 2.5-3.5 percent, based on scores on programs, Logan said.

“One thing we are fortunate for, we did not have to increase insurance costs for health,” Logan said. 

Electric rates could go up

As the budget currently stands, electric rates would increase in January 2017, as wholesale costs are expected to go up by 10 percent and the retail end could be about 8 percent, Logan said.

“We should have increased it this calendar year, but we did not,” Logan said.

The final numbers should be known in late July or August, he said.

Revenue is projected to be at $6.8 million and appropriations are $6.7 million.

“The system itself has been changed and updated, and is a very expensive system and there is some expensive equipment out there,” Logan said. “You have to look to the future, for the next couple generations.”

The wholesale power purchase is anticipated to increase from $4.1 million in 2013-14 and $4.4 million in 2015-16 to $4.5 million for the coming year.

“Kind of a biggy,” Logan said.

Water fund

Assuming water fees are increased by 2 percent, the city’s water fund is set to come out ahead with an anticipated net balance of $126,488 in June 2017.

Revenue for the water fund is projected to be $2.77 million and appropriations are at $2.66 million, nearly identical to last year’s total.

Part of that budget includes a vehicle replacement where a 1985 flatbed truck will get replaced with a 2001 model transferred in from a different department, and that truck will get replaced with a 1-ton truck, said Bill Winters, water superintendent for the city of Powell.

Bids were recently opened for the upcoming water system upgrade project, and they came in at about $470,000, “quite a bit less than we anticipated,” he said.

The project involves better control of the system’s valves plus a generator replacement.

Golf course

The golf course has nearly paid off all of its past debts accrued while getting the facility going. Councilman Eric Paul said the debt is now below $38,000 — a considerable drop from the $130,000 that was owed in 2014, and the $270,000 a few years ago. 

The city spent $76,371 on the golf course in the current fiscal year.

For the coming fiscal year, the city is set to pay $2,400 for irrigation tax. The facility will also receive $12,500 as part of the city’s $64,000 supplemental budget (see related story).

Police Department

The Powell Police Department has one of the largest budgets in the city, and its budget has remained relatively flat in the proposed budget at $2.35 million.

The department hit some “small bumps” because the state cut funding and won’t cover expenses such as exams, so that now falls to the local level, said Powell Police Chief Roy Eckerdt.

“It is getting pushed down to us,” Eckerdt said.

WyoLink could present a possible financial challenge in the coming months for the police department. If needed, the police department can switch back to its previous communications system, he said.

“There are so many departments that would drop it in a heartbeat,” said Powell Information Technology Manager Zack Thorington. He also suggested possibly keeping WyoLink as a backup.

 Airport

There are no projects scheduled for the airport in the coming year, it is all “pretty much maintenance,” Butts said.

The recommended budget for the airport is $258,790, a significant drop from last year’s $684,931 and about on par with two years ago when the facility cost $224,444.

“People think we spend tax dollars on it, but 90 percent comes from the users and the FAA,” said Councilman John Wetzel.

An additional $64,000 is being considered on top of the city of Powell’s preliminary $19.4 million budget for fiscal year 2016-17.

The supplemental budget encompasses funding requests that aren’t necessities for the city, but do enhance the quality of life for Powell’s residents.

Councilman Floyd Young pointed out that some communities have cut out supplemental budgets entirely.

“It is difficult for everyone in the state, like in Gillette and our brother and sister communities — we are lucky,” said Powell City Administrator Zane Logan.

Revenues are down for the city, so to balance the budget, the proposal is to dip into reserves by about $292,000. This would cover the supplemental requests, a project with Wyoming Department of Transportation and road maintenance in downtown, said Logan.

Powell Mayor Don Hillman initially proposed $61,575 for the supplemental budget so that reserves would remain close to $3 million — which is helpful for the city considering the uncertainty of state funding and the drop in city revenue, he said.

“The $3 million is nothing  — get a big storm and you can spend that in a half-hour,” Hillman said. “If we didn’t have that, we would be hurting. The city and employees and staff have done a fantastic job of running their departments and being frugal with their budgets.”

The city was presented with $74,075 in supplemental budget requests, and the council trimmed that amount to $64,075. 

Not all the requests were fully funded and the supplemental budget was increased by $2,500 by the Powell City Council with totals shuffled around from Hillman’s initial suggestions.

• Powell Golf Club did not request funding, but Hillman suggested a $19,000 match to help with the club’s remaining $38,000 debt. The council lowered that amount to $12,500. Both suggested amounts were considerably less than the amount given in the past.

The golf course had $270,000 in debt and that total dropped significantly over the last three years and the facility is in the homestretch of paying it off.

Councilman Tim Sapp asked how much of that came from the city. In the last three fiscal years’ supplemental budgets, the facility received $25,000, $30,000 and $57,103 — for a total of $112,103.

“The thought I had is a goal to get the golf course debt cared for, but I hate to worry about golf course debt at the expense of others,” said Councilman John Wetzel, proposing the $15,000 total. He suggested fully funding Crisis Intervention’s request and increasing the senior center’s amount to $17,500.

“To me, this (golf) is a fun thing,” said Councilwoman Lesli Spencer, adding that the senior center and Crisis Intervention are necessities.

Spencer proposed the $12,500 amount for the golf course that was ultimately agreed upon so that the senior center’s $20,000 could be fully funded.

• Powell Senior Citizens Center requested $20,000 and Hillman suggested cutting it to $15,000 but the council opted to fully fund the $20,000 request.

“One of the things I think we are seeing more and more of is servicing people who aren’t seniors yet,” said Cathy Florian, director of the Powell Senior Center.

Some of their clients are “folks with disabilities” or on a low income and in need of help with filling out forms.

Because the clients don’t live at the center, it costs about $5,000 for a senior citizen to receive services from the center, compared to $60,000 at a care center, she said.

“You guys do a fantastic job — I can’t say enough about the center,” Hillman said.

• Crisis Intervention Services’ request for $6,000 was cut down to $4,000 in Hillman’s proposal and then fully funded following discussion from the city council.

The organization’s executive director, Lisa Peterman, thanked the council and told them that the shelter in Cody was closed because of the cuts made in Cody — meaning Powell is the only shelter in the county.

She also told the council that the center is seeking a grant to help hire a second part-time person, adding another job to the town.

• Powell Valley Chamber of Commerce requested $17,000, and Hillman proposed $10,000. The council agreed on $12,000 after Councilman Tim Sapp asked for the $2,000 increase.

“They do do a lot for community relations,” Sapp said, suggesting the additional funding be pulled from the golf course.

“$2,000 here and $3,000 there and then we are back to where we were,” Hillman said. “I think $10,000 is fair for the chamber, I really do.”

Wetzel suggested giving the chamber $12,000, calling it a “healthy cut.”

• Powell Recreation District requested $15,000 and Hillman cut that to zero since the district can levy a mill, he said.

• Yellowstone Country Assistance Network requested $3,000 and both Hillman and the council agreed to $500.  

The network is the last place people can go to for help when struggling financially, such as with their electrical bills, Wetzel said.  

• Boys and Girls Club’s $7,500 was fully funded without much discussion and Tina Bernard, CPO of Boys and Girls Club of Park County, thanked the council.

“We have been struggling the last year and I’m sure everyone is in the same boat,” Bernard said. “We have been cut by Cody and the county commissioners, so kudos to you for thinking about us.”

The Boys and Girls Club is currently trying to raise $50,000; otherwise the program may have to shutdown (see related story).