HEFLIN — Prompted by the findings of a recent audit, the City Council Tuesday evening discussed instituting cutbacks and raising taxes and fees to help balance the city’s budget.
The audit found that the city had a budget deficit of $109,039 in fiscal year 2017 which the city paid from its capital improvement fund. City clerk Shane Smith suggested to council members various proposals to create a rainy day fund for future unexpected expenditures.
“At the request of the auditors they wanted us to have a fund in place and I wanted to have, what I guess I call, rainy-day fund in case we needed money for emergencies,” Smith said.
Right now, he added, “we don’t have a good rainy-day fund in place,” Smith said.
Smith’s proposed cuts and changes include:
— No raises for city employees, although he allows for a 1 percent increase if possible.
— Cutting spraying pesticides in city buildings from four times a year to only two times.
— Cutting the employee education and training budgets in half.
— Possibly cutting contract services like water for employees and copier lease agreements.
— Cutting the chamber of commerce appropriation amount from $5,000 to $2,500.
— Changing phone/internet/fax service to a new provider saving a total of $8,771.
Smith said the city is losing money at various facilities the city maintains including the arts center and recreation center.
“It’s not like we’re spending money on stuff. It’s maintaining our stuff,” Smith said.
“Because we have so many different needs in regards to staffing and facilities and maintaining; that’s where our problem is,” said Smith.
Smith also wants to increase business license fees and other fees the city charges.
“Because we haven’t addressed our business license issue over years, we’ve been taking a huge loss in revenue,” Smith said.
Smith showed the council a chart of the top twenty city taxpaying businesses and said, for example, the topmost business would see a $730 increase in its business license fee under the new rate if approved. Smith said that some businesses would see a reduction in their business license fees under the proposal. A tiered base fee would be used to calculate a business's license fee, instead of using gross receipts which Smith proposed last year.
Smith compared the tax rates of Heflin to other towns including Odenville, Oxford, Lincoln and Columbiana and said all of those towns charge much more in business license fees.
“We’re leaving money on the table. We should have done this a long time ago,” Smith said.
Besides raising business license fees, Smith is looking at raising the fees the city charges general contractors and subcontractors who do business in Heflin.
Smith wants to charge general contractors $300; the city currently charges $110.
Subcontractors would see the fees they pay the city go from $55 to $200.
Smith also wants to raise rental fees for mobile home parks and rentals in the city.
Heflin Mayor Rudy Rooks agreed in principle with Smith’s proposals and said that it’s not about raising revenue but more about being in line with other cities with the same population that Heflin has.
“They are getting a pretty good bargain doing business in Heflin, and us providing the protection that we do and the services that we do,” Rooks said.
Smith invited business owners and citizens to the next week’s work session / meeting to voice their opinions and concerns about the proposed fees.
Smith said he hopes the council can vote on the proposals in September.
The work session / meeting will be on August 14 at 5:30 at City Hall.