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Mayor's Office Heading City Letter Head
CITY OF LINCOLN   •   NEWS RELEASE   •   FOR IMMEDIATE RELEASE

Date:
September 27, 2001
For More Information Contact:
Dave Norris, Citizen Information Center, 441-7547
Steve Hubka, City Budget Officer, 441-7698

Mayor Releases Latest Sales Tax Figures;
Extends Freeze on Reappropriated Funds as Precaution
Wesely to initiate budget actions

Mayor Don Wesely announced today at a news conference belt tightening measures to address the potential lagging sales tax revenues for the city. Wesely referred to sales tax collections for the first month of the new fiscal year are about $500,000 below the projected amount. While gross collections are still showing growth, a high-level of unpredicted LB775 business refunds are reducing revenue growth.

At the news conference, the Mayor shared memos he distributed to city department directors on August 17 and September 26 regarding year-end reappropriations and 2001-2002 Capital Improvement Program (CIP) expenditures.

In August, the Mayor declared a moratorium on the use of reappropriated funds from prior fiscal years until October 1. On Wednesday, Wesely extended the moratorium until further notice. Wesely took the additional action of directing city departments to suspend all activity on projects in the 2001-2002 CIP funded with General or KENO revenue until further notice. Wesely also imposed the same restrictions on projects from prior year's CIP budgets that are not currently under contract. He also expects department directors to exercise ongoing scrutiny of all expenditures from operating budgets.

In announcing these actions, Wesely's directive acknowledged the need for some exceptions where General Fund or KENO revenues comprise a piece of a larger program. Exceptions will be considered where the unavailability of these funds creates an undo delay in performing necessary city services or if these actions would have an adverse economic development impact. The total appropriations covered by these directives could be up to $5.8 million. Wesely stressed that these are precautionary measures being taken to avoid more drastic measures being necessary if revenue in the coming months falls well short of previous estimates. The city also plans on monitoring information that will be forthcoming from the state's Advisory Forecasting Board and the probable special session of the state Legislature.

Mayor Wesely assured the citizens of Lincoln that the core services of the city will not be affected.

"We're still going to construct sewer lines, build new streets and plow the snow this winter," Wesely said. "The financial position of our city is still very strong despite the fact that we're facing times that are going to demand that we all tighten our fiscal belts."

While the Mayor is not exercising his full budgetary authority at this time, the city charter states "at any time, during the budget year, the mayor determines that the available income for the year of any specific fund will be less than the total appropriations authorized from such fund, he shall have the power to reduce appropriations from such fund so as to prevent the incurring of a budget deficit for that year."

Wesely emphasized that he will use his mayoral authority to protect the city's financial welfare and city services. While the mayor is not using his authority to reduce appropriations at this time, it remains a possibility if the situation warrants such action later in the fiscal year.

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