The city’s 2011 mid-year financial report shows sales and use tax revenue – the city’s main source of income – is at $36.5 million as of June 1. That’s roughly $1.5 million higher than in 2010, the year that put the city back on firm financial footing. In May, the city collected $9.6 million, up from $8.9 million in May of last year.
Overall, sales tax revenues are up 3.25 percent so far this year.
While that might be good news for city services, Mayor Steve Bach has issued a hiring and promotions freeze until after the 2012 budget is completed in order to bolster the city’s fund balance.
Currently, the city’s fund balance is 13.4 percent, or $30.2 million. That’s the highest since 2004, noted Lisa Bigelow, budget officer at Monday’s city council meeting.
Still, it isn’t high enough for Bach.
“This is a major concern of mine, and we will increase the fund balance,” he said. “We have to, so we’re prepared for another downturn. I’ve heard talk of another recession in 2014. We have to be ready.”
The city’s coffers were hit hard during the last economic downturn, leading to severe budget cuts that turned off street lights and left parks unwatered.
“I don’t want to be a laughingstock of the nation,” said council member Tim Leigh. “I campaigned on this and it’s an issue I’m behind. We have to address it.”