MAYOR SAYS JPA FUNDS SHOULD BE SAVED
The creation of a Joint Public Agency (JPA) to finance the new County jail has freed up $1.4 million in the City budget. Mayor Chris Beutler today called on City leaders to avoid the temptation to spend the funds or reduce the City’s tax levy. He said the funds should be saved as a precautionary measure in uncertain times.
“We do not yet know how our sales tax projections will hold up in a difficult national economy,” Beutler said. “The first returns from the start of our fiscal year have not been encouraging. With the collapse of the national real estate market, we need to be wary of the revaluation of real property in 2009. If property valuations stagnate or show an overall decline in value, that could mean hundreds of thousands or even millions of dollars in losses to the City’s General Fund.”
Beutler said other factors to consider are the lack of an agreement with the Firefighters union and the impact of decisions made in the upcoming State Legislative session.
The City and County formed the JPA to provide the best financing terms for the new jail. The property tax bills being issued this month will show levies for two new items: City Joint Public Agency and County Joint Public Agency. “It is important to understand this does not represent a tax increase for City government nor even an indication of higher city spending,” the Mayor said.
Under the new arrangement, the City no longer needs to pay $1.4 million for housing City prisoners in the County jail. “It is tempting to find new uses for that money, and soon many of our City’s special interest groups will feel that temptation,” Beutler said. “Others will try to argue that the money is a ‘windfall’ that we can use to reduce our levy. But they won’t tell you that their levy reduction will certainly require very undesirable additional budget cuts to cover those reductions in the future.”
Beutler said prudent use of the funds will continue the progress made in solving the City budget’s structural imbalance. “Unlike many communities during these tough economic times, we can weather the national crisis and leave this community strongly positioned to take quick advantage of the next economic upturn,” he said.