COVINGTON - The City Council approved a $120.5 million budget Monday night and agreed to keep the millage rate at 8.208 mills.
Mayor Kim Carter called it "a very lean budget, but a very doable budget."
The city is projecting $120.5 million in revenue and about $120 million in expenditures, leaving a surplus of approximately $529,000.
This year's budget is roughly $12 million less than last year's, with cutbacks in personnel and capital projects and a decline in revenue projected.
"It's a sign of the times," City Manager Steve Horton said. "We've got to do more with less."
Though the tax digest has increased, Carter said the council opted to take a conservative approach with revenue projections "so we're not caught off guard by any surprises."
The city has between 10 and 12 vacant positions that will remain unfilled, and employee raises will be cut in half, according to Horton.
In addition, "Every department is off on capital projects. We're only doing what we feel like we need to do," he said. "We don't have any wish list projects in there."
Water and sewer tap fees are down about 85 percent due to a lack of new construction, Horton said.
Revenues from electricity sales are down by more than $900,000 from last year. Gas revenues are up by about $1 million, though once costs are subtracted, the fund breaks about even, Horton said.
The budget will need to be amended once the hotel/motel tax increase goes into effect, he said.
Raises for the mayor and council totaling $24,000 were included in the budget, bringing the total budgeted amount for council and mayor salaries from $48,000 to $72,000.
However, although the budget as a whole was approved, the council will vote on the pay raises as a separate line item at a later meeting.
If approved, the mayor's salary would increase from $12,000 to $18,000 per year and the yearly salary for council members would increase from $6,000 to $9,000. The current salaries have been in place since 1977.
The raises were initially proposed in February but were taken off the table at the advice of Horton due to the economic climate.
A city ordinance requires any pay raise for elected officials to be approved before qualifying for the next election. Qualifying for the 2009 Municipal Election takes place Aug. 31 through Sept. 4. If approved before then, the raises would go into effect Jan. 1.
Two new positions were also included in the budget: community/economic development director and financial coordinator.
The community/economic development director's salary was budgeted at $78,000 plus benefits. According to Horton, that person will work in conjunction with the Chamber of Commerce and Main Street Covington "to add to and enhance the local economic development and community development programs."
"I think the idea here is to work on poverty, housing and other local improvement functions so as to make our community an overall better place to live for all, while at the same time making it more attractive to businesses and industries who may consider locating here," he said.
The job will also entail finding ways to help retain existing businesses and industry.
The financial coordinator position was budgeted at $50,000 plus benefits. The position came about as a result of the city's involvement in the Neighborhood Stabilization Program, which provides federal stimulus money to local governments to rehabilitate or redevelop foreclosed properties.
"Dealing with federal funds and the various entities necessary to carry out the elements of this program involves complex and detailed tasks. Further, if our program proves successful, and we believe that it will be, we anticipate the opportunity to receive additional funding to expand our housing program of work," Horton said. "Having a relatively small accounting/finance staff, already, at the city, there is the belief that this position will ... become necessary so as to conduct the financial duties associated with the housing program."
Like the pay raises, both positions must also receive council approval at a later date before they are implemented.
Councilman Keith Dalton said he couldn't support the budget with those line items included.
"That's about $190,000 that I would like to see not in this budget," he said.
The budget was approved 5 to 1, with Dalton opposing.
Crystal Tatum can be reached at firstname.lastname@example.org.