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City staff unveils its 2014-15 budget

Financial condition is buoyed by a recent pension obligation bond transfer


Prineville City Manager Steve Forrester calls the city budget the foundation of day-to-day operations.

“This is a working document that we use virtually every day,” he said.

Last week, he and Finance Director Liz Schuette revealed their proposed 2014-15 version of the document to the budget committee and they anticipate passing another strong budget.

Perhaps the highlight of the budget this year is the inclusion of a fully-funded PERS liability. In January, the city completed a pension obligation bond transaction that paid off their $2.846 million unfunded liability.

“That’s a huge accomplishment,” Forrester said. “The strength of our budget has allowed us to complete that transaction and maintain extremely healthy fund balances, which is remarkable.”

Schuette noted that of their 11 funds that require policy reserves, they are budgeting to meet policy on nine of them this coming year.

Overall, the city budget proposal shows a 24 percent decrease from the previous year, from $33.72 million to $25.49 million. The PERS fund accounts for about $3.8 million of that total, as the city paid the full unfunded liability in the 2013-14 year. The water SDC fund dropped from $3.1 million to $77,158 due to the completion of a large scale water project in the 2013-14 year. Apple paid significant SDCs associated with substantial water system upgrades, including a new well, one mile of water line, and a 1 million gallon storage tank.

Meanwhile, the railroad fund dropped from $2.17 million to $1.4 million because of completed work funded by Connect Oregon grants. Now that the work is done, the grant funding will not continue into the 2014-15 year.

When it comes to public safety, a concern that city leaders have expressed in the wake of the recession, Forrester said they are focusing on making improvements to equipment and vehicles to bolster the police department. Police staff will go unchanged.

“We were able to upgrade our (patrol car) fleet,” he said. “We had an aging fleet that was costing the city a significant amount of money in repair/maintenance. We have seen a nice offset in terms of our repair/maintenance coming down.”

Forrester added that the city invested in a radio upgrades plan to make more connectivity efficiency upgrades in the coming year.

“We continue to look for efficiencies to use the existing force that we have more effectively,” Forrester explained, offering the reinstatement of My Neighborhood My Cop and the activation of a new emergency Twitter account as examples. “It would be easy to continue to add personnel, and because of our conservative approach to financing, we would rather focus on maintaining our equipment and maintaining our training and making sure that the folks we do have employed are well-equipped.”

Unlike recent years, the city is anticipating an increase in property tax revenue as local home values rebound. However, staff members are not going to count on the 10 percent increase projected by the county assessor.

“The city was conservative in their budgeting and budgeted a 5 percent increase,” Schuette said.

The approach falls in line with the philosophy the city hopes to adhere to as economic recovery continues and revenue becomes more plentiful. Forrester explained that they developed a strategic approach to budgeting in the midst of the recession, and intend to continue that approach regardless of economic conditions.

“As we come out of the recession, our challenge is going to be to hold to those principles,” he said. “We are going to stay prepared for a rainy storm in the future.”

The city budget committee will conduct a budget hearing on Monday, June 9, and will adopt the budget on June 24.




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