City proposes $113 million 2019-2020 budget
The city of Newberg is proposing a roughly $113.9 million budget for the upcoming fiscal year, an increase of more than $17 million (18 percent) over the 2018-2019 operating budget.
However, until a budget memo from the city manager is made public, city officials are remaining mum on many of the specifics of the budget and the need for the increases.
The city used an estimate of 4.3 percent growth in assessed property value to prepare the upcoming budget, which represents the state-mandated maximum 3 percent increase in taxable assessed value plus an estimate growth rate of 1.3 percent.
City Finance Director Matt Zook said the city's operating budget, proposed at more than $37.26 million, is where the daily operations of the city live and breathe. That number is an increase of 7 percent over the current operating budget of roughly $34.82 million.
The exact budget proposed is $113,849,504 compared to the 2018-2019 budget of $96,170,736, a proposed increase of 18.4 percent.
"It's not meant to draw a big conclusion," Zook said of the budget document. "There are so many funds inside that number that represent the activity of the city."
He added that there are items within the budget that increased outside of the city's control, such as cost of living expenses for employees and union-negotiated contract items.
"That's business as usual activity," he said.
Total appropriations in the proposal rose by slightly more than 26 percent. The proposed appropriation line was more than $102.59 million, a substantial gain over the appropriation line of roughly $81.27million. The city's operating budget is included in this line.
Some of the larger increases in appropriations came from capital projects, which rose more than 31 percent from roughly $14.9 million to more than $19 million. Zook said transfers between funds are included in appropriations, which rose more than 36 percent from roughly $13.3 million to more than $18 million.
"That's just transfers between funds, but it gets counted in appropriations," he said.
Contingency, which is also listed under appropriations, rose by 96 percent under this proposal, from the current $11.8 million to nearly $23.3 million.
Zook said several items did not change in the proposal. For example, the city's debt service actually decreased by about 15 percent. Zook said the city hasn't taken on any new debt and was paying off its existing debt. He also said there was not much change in insurance costs.
The budget proposal was revealed April 17 and the next step includes the budget committee's Tuesday meeting, where department heads discussed things that didn't get into the budget. These things include items or positions they asked for but didn't get, or things they didn't ask for or were deferred or need to be addressed in the future.
The proposed budget does not include the addition of any full-time employees. The growth in full-time employee hours will increase by less than one-half of one percent under the proposal.
Zook said part of what was not included in the document is the budget message, which is written by City Manager Joe Hannan. That message was delivered at the Tuesday budget committee meeting. As of Friday, Zook said he was still communicating with Hannan over what he could explicitly discuss regarding the budget content.
The budget committee could meet as many as seven times to discuss the proposal as many of its members are new city councilors or have been recently appointed.
The city has a permanent rate tax limit of $4.38 per $1,000 of assessed value. The budget included a reduction of $1.88 per $1,000 of assessed value in property taxes due to the city's merger with the Tualatin Valley Fire & Rescue district; a 4 percent increase in water rates, a 3.5 percent increase in wastewater rates, and a 9 percent increase in storm water fees.
Zook said the new budget has a property tax rate increase of 7.5 cents per $1,000 of value. That's a 3 percent rate increase, which the city charter allows for each year as part of the charter amendment when the city shifted to TVF&R.
Zook couldn't speak about property tax proceeds, since that depends on the county's assessments of property values and is out of the city's control. The budget committee ultimately approves the tax rate.
Because the budget proposal had only just been released, members of the budget committee have not had the chance to review and discuss it. City Councilor Patrick Johnson, a member of the budget committee, said he planned to review it over the weekend, but added they won't receive Hannan's memo until the first committee meeting.
"My understanding before having read it is that it's going to be a pretty (much a) hold the line budget," he said "I've been told we don't have any increases in the general fund."
Mayor Rick Rogers, also on the committee, declined to comment without speaking to Hannan first.