Councilman Jon Hensley provides insight into the city’s budget.

I was elected to the Jefferson City Council in April 2018, and I’m nearing the end of my first term. Among the many important, fascinating, and detail-laden things I have learned so far, my absolute favorite has been studying the ins and outs of how the City of Jefferson generates, appropriates, and spends money. I find this topic so fascinating, in fact, that it will constitute the entire focus of this article! This first installment is intended to serve as a high-level orientation regarding our city’s budget basics.

Portrait of Jon Hensley

The city’s fiscal year runs from November 1 to October 31. The budget formation process begins early each summer, reaches the council for discussion later in the summer, and deliberations usually run into early fall. Because council members are (wisely) prohibited from attempting to direct the daily actions of individual members of the city staff — beyond passing on concerns received from residents regarding potholes, roaming pets, tall grass, noisy neighbors, and the like — the allocation decisions are among the most direct ways we on the council can impact people’s lives and our community. Budgets are nothing less than stark statements of priorities, and we take this responsibility extremely seriously.

Timeline of the fiscal budget from November 1 to October 31

How much? 
Budgets approved annually by the council have totaled around $65 million in recent years. Almost half of that amount is designated to “enterprise funds” (revenue from a city-owned facility or service, like wastewater or parking) or are from other dedicated revenue streams and can only be spent in relation to that service or purpose. This limited discretion left us with just north of $32.9 million to fund the rest of city government and services for this new fiscal year. (One notable exception to this is the parks department.)

Pie chart of incoming funds.

Where from?
The single greatest source of general fund revenue is sales tax receipts, budgeted to bring in almost $11.9 million this fiscal year, followed by franchise and utility taxes ($7.2 million), property taxes ($5.5 million), charges for services ($2.9 million), and intergovernmental taxes ($2.3 million). The remaining nine budgeted general fund revenue streams combine for a projected total of just above $3 million. 

Sales tax revenues are the product of the 1% city general sales tax. A separate half-percent sales tax is dedicated to capital improvement projects, and another half-percent sales tax helps fund the parks department.

Pie chart of outgoing funds.

How spent?
This fiscal year, 31% of the general fund budget has been appropriated to the police department, with approximately 24% going to the fire department, 18% to public works, and 6.6% to planning and protective services, totaling more than 80% to these core functions. Almost 78% of the spending budgeted through the general fund is spent on employee compensation. We also maintain an unassigned fund balance for unforeseen circumstances; this fund is at least equal to 17% of the year’s adopted general fund budget. 

The challenge, then, is figuring out how to prioritize and fund the many other important services and programs offered by the city with what money is left. 

I’ll provide a deeper exploration of these exciting topics, as well as other budget insights, next issue.