Avalon’s deficit has decreased by more than $900,000, City Manager Ben Harvey told the City Council on Tuesday, March 18.
The deficit was originally $1.6 million. But during the mid-year budget review at Tuesday’s council meeting, covering the period from July 1, 2013, to Dec. 31, 2013, Harvey said the deficit had been reduced to $688,971.
Avalon’s deficit has decreased by more than $900,000, City Manager Ben Harvey told the City Council on Tuesday, March 18.
The deficit was originally $1.6 million. But during the mid-year budget review at Tuesday’s council meeting, covering the period from July 1, 2013, to Dec. 31, 2013, Harvey said the deficit had been reduced to $688,971.
According to the staff report by Project Manager Gina Suchard, staff had an 80 percent confidence level on the status of the city’s reserves. Suchard’s mid-year budget review put the confidence level at 90 percent.
Suchard’s staff report projected an increase in revenue to $800,262, based on several assumptions. The report said Transient Occupancy Tax revenue is expected to increase by $50,000.
Harvey said that the city had received 47 percent of the budgeted revenues by mid-year and that the city had spent 43 percent of budgeted expenses.
Harvey attributed the decrease in the deficit to several causes, including offsets from Packy Offield for the Joe Machado Field Concession stand and an unexpected $300,000 from redevelopment funds.
Harvey said the reduction was caused by “a lot of small things working together.”
However, Harvey said Avalon was not out of the woods yet.
He recommended the council hold a financial workshop in May to discuss shoring up city funds that are underfunded, including the sewer and salt water funds. He described those funds as “problem children” that drain the city’s reserves.
“For now, we’re still in the process of eating away at that deficit,” Harvey said.
He also said there were two projects looming for Avalon: the Mole and the fuel dock.
Mayor Bob Kennedy said Avalon has $500,000 set aside for the Mole.
Kennedy said one item Harvey missed was the sewer infrastructure.
Avalon is under a cease-and-desist order from the state to improve water quality in the bay. If state government-established water quality standards are not met on schedule, Avalon could be subject to fines.
“The sky is not falling, but we still have a lot of work to do,” Kennedy said.
Council Member Oley Olsen suggested a review of past system repairs to help plan for future repairs.
Kennedy said Avalon would always have to repair the salt water system.
Council Member Ralph Morrow said the city started with $10 million in reserves. He said the city would now have an estimated $8.3 million in reserves.
“We’re making good progress,” Morrow said.
He said the Finance Department did a good job.
The council received and filed the report.
