Manistique council reviews city budget

MANISTIQUE – Manistique City Council members reviewed the city’s budget status for the halfway point of FY 2013 during a recent council meeting.

The city’s FY 2013 budget officially began on July 1, 2012 and ends June 30, 2013.

“This would take us halfway through our year when we would like to see expenses such as salaries and recurring monthly expenses at the 50 percent mark,” said Manistique City Manager Sheila Aldrich.

The city ended FY 2012 with a general fund balance of $473,579.36 – above the recommended 10 to 15 percent of the fund’s revenues. When factoring in this amount with FY 2013 year-to-date revenues of $1,324,052.19 and expenditures of $1,168,955.45, it leaves a current fund balance total of $628,676.10 as of Dec. 31, 2012.

Aldrich noted one highlight of the budget review is property tax revenues have come in at 87 percent of the appropriated amount of $786,000, which is typical halfway through the year.

In addition, the city has received $36,414 of the appropriated $50,000 for meeting the first of three state requirements linked to the Economic Vitality Incentive Program which has replaced the former statutory revenue sharing funding.

A Department of Public Works service charge line-item of the budget indicates much higher revenues of $12,418.61 compared to the city’s appropriated amount of $200. Aldrich said this is due to the inclusion of the sale of scrap in addition to the sale of a dump box and two old snowplow trucks.

As for expenses in the general fund, Aldrich noted most recurring expenses such as salaries and fringes are at approximately 50 percent, a good level for this time of year.

One highlighted expense is a $2,122.55 fine the city owed due to a payroll error. Aldrich said the city knew of the error and contacted the IRS.

They immediately sent the additional amount of money due, but the IRS would not forgive the penalty.

“We had an error in our payroll system and so we hadn’t sent in the correct amount because we had the wrong tax percentage in our system and the software didn’t pick it up,” explained Aldrich.

She said she hopes the city’s new software will not allow this to happen again as the new system will automatically update rates at the beginning of the new year.

Gas service expenses in the building and grounds portion of the general fund budget is down so far for FY 2013, at just 9.89 percent of what the city had appropriated – indicating a potential savings.

Expenses related to utilities at Lakeview Cemetery are currently at $7,755.99 – more than double the appropriated amount of $3,500 due to a leak in the sprinkling system and a stopped meter. The city is working with the Ethel Brown Trust on a reimbursement regarding the additional expenses.

A capital outlay expense in the Department of Public Works portion of general fund shows an increased expense of $149,302 from the appropriated $5,000 reflecting the purchase of a new snowplow truck.

Aldrich said she is pleased with end of December budget totals and department heads are responsibly managing their budgets.

“We were very pleased with it,” she said. “It definitely fell within the parameters we like to see and we were extremely pleased with department heads for keeping an eye on their expenses. They do an excellent job for the city.”

In other business, council voted to convert the city’s current Harris software program to BS&A software. The upgrade is all-encompassing, and covers general ledger, accounts payable, payroll, and utility billing at the cost of $15,605.

There will also be a $12,850 cost to convert the history in each of the four areas. In addition, council has allotted $12,600 for training on the new program over a 12-day period. If less time is spent on training city employees on the new software, the cost would go down, said Aldrich. She noted the city’s current software does not serve the city’s purposes and the BS&A format is much more user-friendly.