Quincy feels budget crunch

Mayor warns of 2006 shortfall

QUINCY — According to current projections by Mayor Dick Zimbelman, the city of Quincy may have a current-expense budget shortfall of $154,000 for 2006.

During the July 5 City Council meeting, Zimbelman reported that the city will likely have both lost revenue and increased spending next year equal to roughly 10 percent of the $1.7 million current-expense budget.

The combination of both lost revenue and increased spending may result in cutting funding that is currently committed to law enforcement, recreation or other areas, Zimbelman said.

"There are a lot of options out there," he said. "You're either going to have to cut expenses or generate more revenue."

The current-expense budget covers the expenses for the police department, fire service, park maintenance, building department and some administration. Most of the budget pays for police operations; it costs the city $75,000 for each officer that is on the street. With the elimination of two officers, the city could nearly make up for the projected 2006 budget shortfall, Zimbelman said.

The mayor said he doesn't want to take police officers off the street, close parks or raise taxes, but something must be done.

Another solution the mayor offered is raising taxes by 2 percent on utilities. He said that Quincy resident's current taxes are among the lowest in the state and if future taxes on electricity, water, sewer and garbage were raised from 4 to 6 percent, the city could make $141,000 to cover next year's projected shortfall.

The mayor said there are several reasons why he had to warn the city council about the 2006 budget.

First, the city lost property tax revenue worth about $20,000 when the values of the city's industrial plants were assessed lower, he said.

The second, and major portion of next year's budget shortfall, will be created by additional expenditures of $134,000 beyond the 2005 budget. For example, the city will have to pay $50,000 more than it did in 2005 for recent pay increases for city employees. It will also cost the city $40,000 next year to pay for a former police officer to live in a nursing home, according to the mayor's estimates.

In 2005, the city received 28 percent of its total sales tax income from new construction and farm implement houses such as John Deere and Ford-New Holland. This portion of the city's sales tax revenue can be an inconsistent and volatile source of income, but with a stimulated economy from new construction, the city could make up for some of the 2006 projected shortfall with a sales tax windfall, the mayor said.