City finds $560K in surplus

The city of Waynesboro netted a $560,000 surplus for fiscal year 2009, leaving members of the City Council with the option to pursue a sizable project.

An independent auditor presented the Council with the city’s Comprehensive Annual Financial Report on Wednesday night.

The surplus will be placed into the city’s undesignated general fund, which now holds $1.8 million more than is required by city fiscal policy for reserve funds. That policy calls for 15 percent of operating revenues to be held in reserve.

“That is very good news. We controlled our expenses,” Finance Director Pat Nicosia said Wednesday. “[Staff and the Council] recognized early on that there were problems with the economy.”

The surplus, which is often achievable, came despite wavering sales tax revenue and a longstanding decline in manufacturing tax revenues, said Nicosia, who called that fiscal year “nerve-racking.”

City Manager Mike Hamp said the surplus reflects the “collective diligence” of city departments and the Council.

“We believe that the core government services were not appreciably impacted,” he said.

Library and city pool hours were not reduced, he cited for example.

The city since FY09 has imposed more severe cost-saving measures. The city remains under a hiring freeze and Hamp has instructed departments to seek 5-percent reductions in budgets.

The Council will have to decide if the surplus should be spent or held in reserve. Members are already planning to hold a special meeting to prioritize outstanding capital projects.

Councilwoman Lorie Smith said she would consider using the money for a one-time project. She referred to traffic signal preemption, alleyway maintenance and funding for the Economic Development Authority as projects that have recently been discussed by the Council.

She cautioned that a surplus, if any, would not likely be substantial for this fiscal year.

According to the financial report, overall revenues declined by $500,000 and expenditures decreased by $100,000 in FY09. The city received bond proceeds of $5.9 million in that period.

“I’m more inclined to hold it until we need it for something necessary,” Councilman Frank Lucente said, adding that Council might be able to reach consensus on a capital improvement project.

“We know we’re in a tight economic situation,” he said.

Nicosia said that sales tax revenues for this fiscal year have not met projections, making for an uncertain budget outlook. Hamp agreed. He instructed departments to reduce budgets when early revenue statistics were not promising.

“You learn very quickly that at the end of the day your options to deal with problems become pretty limited,” he said.