Monday, July 28, 1997
City's equipment fund almost depleted
By ANTHONY WILSON
Staff Writer
The city fund that pays for new police cruisers, garbage trucks
and street sweepers is in danger of being depleted.
To avoid emptying the fund this year, City Hall has drastically
scaled back the amount of large equipment it will replace, a plan
that could backfire if it yields higher maintenance costs, more
down time and frequent work stoppages.
"We're just going to hope we don't have a lot of added
breakdowns," Finance Director David Wright said Friday following
the City Council's approval of a proposed budget. "It's a
gamble we've got to take to keep the program solvent one more
year. It's a Band-Aid approach until the next budget and until
we find a way to get the program back on its feet."
The city's equipment replacement fund has financed the purchase
of its vehicle fleet and large equipment since the 1960s.
Under the program, the city rents its rolling stock and equipment
to its departments, charging either a flat fee or rates based
on usage. The revenues are poured into the equipment replacement
fund, paying for approximately $2 million in new equipment annually.
During the oil bust of the mid-1980s, the City Council slashed
the charges to ease the strain on the city's general fund. While
revenues dropped from $1.5 million to $900,000, costs have remained
constant, slowly draining the fund.
Even as the economy strengthened, the council didn't restore
the charges necessary to maintain an adequate balance. Again Friday,
the council decided to wait until next year to address the problem.
"As long as it looks like there are sufficient dollars
in the fund, we don't think about putting more in," Mayor
Gary McCaleb said. "The impact is just now being realized.
We're getting precariously close. That's probably the most worrisome
thing to me about the budget."
In recent years, the equipment replacement fund fell victim
to higher budget priorities.
This year, it was a storefront branch library, Wright said.
And he admits the administration would have lobbied harder for
the equipment fund if not for the pressure to maintain the current
tax rate as the city prepares for a $10.5 million bond election.
Wright voiced his belief the fund should be a high priority.
"We've got to do something to save the program,"
he said. "It's too good of a program to go by the wayside.
It helps to level out the peaks and valleys of the cost of equipment
replacement.
"It doesn't take much of a genius to see what's going
to happen," he added. "If we replace what we should
next year, we're going to virtually be out of cash and the fund
will be out of business."
For the 1997-98 budget, the city divided its "priority
one" replacements into three subgroups. Of the $2.8 million
total needs, the city will fund $1.8 million, leaving the equipment
fund a $1.2 million balance.
If the city had funded all the needs, the balance would have
shrunk to $279,029. Wright said the fund should maintain a $2
million balance. "We're going to have to face hard decisions
soon to get the equipment replacement fund back on track,"
Councilman Don Drennan said during Friday's budget workshop. "We
don't want to have to spend out of the general fund."
Some council members have suggested dedicating this year's
budget surplus to the fund.
But the council has already voiced some sentiment the Abilene
Cultural Affairs Council, the Taylor County Expo Center and the
Abilene Regional Council on Alcoholism and Drug Abuse be "high
priorities" for extra funds.
And with sales tax collections closely tracking projections
Wright made during last year's budget process, he doesn't expect
a revenue windfall.
"Next year this has got to be the high priority issue,"
he said.
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Abilene Reporter-News / Texnews / E.W. Scripps Publications
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