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A summary of the 2008 City Budget

Warwick Jones and Marc Knapp

Viewers can see a summary of the City’s 2008 budget prepared by Charlstonwatch. The summary is broken down into 4 components:

General Fund Revenue Download file
General Fund Expenses Download file
The Enterprise Fund – Revenue and Expenses Download file
Charitable Contributions a.k.a as Assistance Program Download file

Our comments
An analysis of the City’s 2008 budget figures had few surprises. The Mayor had already indicated that property tax and parking rates would rise in 2008.

General Fund
With these increases, total revenue for the General Fund for 2008 is projected to rise only 6% over 2007 to $122.2 million. A factor that restrained the increase was a run down of $4.7 million from the Balance Sheet surplus compared with $4 million in 2007.

General Fund Expenses are projected to rise also by about 6% to $123.9 million. Higher costs of the Fire Department account for the major part of the increase.

Some points:
• Property taxes and fees in lieu of tax are projected to rise 12% to $49.2 million. This figure represents 10.2% of the revenue of the General Fund.

• Police Fines are projected at $892,000. This is a relatively small amount but an increase of 22% over 2007. The new Police Chief is expected to galvanize the

• Fire Department costs are projected at $17.9 million, an increase of 20% over 2007. When the cost of training is added to the total it becomes $18.3 million and represents a 23% increase. Fire Department costs in 2008 are projected at 15% of General Fund spending.

• Employee Benefit costs are down 27% to $4.3 million. The fall is related to a change of a new manager, effected earlier this year.

• They may not be material amounts, but we note that in the 2007 budget and the amended budget, social security and pension benefits do not change in many accounts even though salaries increase. For example, in the Garbage Collection account, salaries were budgeted at $1.576 million but in the amended budget were $1.452 million. Yet in both budgets, social security and SC retirement provisions were steady at $110,630 and $136,380 respecitvely. We would think there is a strong correlation between salaries and social security and pension benefits.

Enterprise Fund
Revenue from the Enterprise Fund is expected to rise to $21.7 million in 2008, an increase of 17%. Parking revenues led the increase. Costs are also expected to rise but at a lesser rate of 16%%. In consequence, the Fund should have a surplus of $1.7 million, which will be used to help finance the General Fund. Some points:

• Parking Revenues are projected at $16.2 million, an increase of 12%. They will represent 74% of total Enterprise Fund Revenues

• The City Market’s contribution is projected to rise to $1.2 million, a 121% increase. Costs are also expected to rise, by 524% to $710,000. This is all allied to a change in management and probably an increase in charges to vendors.

Assistance Program
Viewers can make their own judgment of the Assistance Program. The nature of the program is identical to that of the County’s Outside Agencies Program. In the face of public criticism, the County is considering stopping or amending its program. As we have pointed out in this blog, the Post & Courier has been the harshest critic of the County. But it has said nothing about the program of the City. So much for the integrity of our daily newspaper!

The City says that it polices hand-outs and that strict conditions have to be met. But the public has little inkling as to whom it is that places the names on the final list. We believe that the County as equally diligent in it decision process. Indeed, there were public hearings related to the process. City Council in the past has approved the hand-outs with little or no questioning.

As the protagonists said at the debate at the last County Council meeting where Contributions to Outside Agencies were discussed – worthy names were on the list and the County may have to pick up the financial tab if the private sector does not fund them. Support is actually saving the County money. But the antagonists said that the causes may well be worthy but the County’s business was not charitable giving. Tax payers did not provide funds for the County to give away.

The above comments could be applied to the program of the City. We would also add that we are not convinced that all hand-outs are altruistic.