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Stew Lilker’s

Columbia County Observer

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Lake City News

Lake City holding the line on taxes
Employee Pension Fund Deficit: $477,000

Last night Lake City's Manager, Wendell Johnson, recommended holding the line on city taxes for 2012. CM Johnson told the Council that the City can "tough it out" without a tax increase. 

CM Johnson explained that 2012 budget is going to be a "tight budget - nothing frivolous." Mr. Johnson said there'll be no employee cost-of-living raises. 

"The modest increases that we've given in merit pay in past times will be eliminated. There will be a small amount of money put in there where there is some achievement," he said.

Employee Pension Fund Deficit: $477,000

CM Johnson continued, "The one big change and expense that we'll experience this year is [in] The General Employee's Pension Fund... There is a deficit in the balance of the pension fund." 

CM Johnson explained the fix:  Instead of upping our contribution amounts on a year-to-year basis, for a number of years, is just go ahead and fund that deficit out of the reserves in each department. That's about $477,000. That was the biggest unknown expense this year. 

City Manager Johnson did not give a detailed explanation of the Pension Fund deficit, how long it took to accrue, or the reasons for its existence. The City acts as a trustee for the pension plan participants.

CM Johnson explained his reason for a one-year fix:  I think given the circumstances -- given the unpredictability of the actuarials that come each year to project what we should contribute, that it would be just to our advantage to go ahead and shore that up, so we're only dealing with the current year and not trying to add in extra money each year."

City Manager Johnson did not give a detailed explanation of the Pension Fund deficit, how long it took to accrue, or the reasons for its existance.

According to the last City audit, the deficit lines up this way:

Governmental Activities, $287,473; Business-Type Activities, $190,057. The total City obligation is $477,530.

More about the budget: "There is no smoke and mirrors -- it's the real deal."

CM Johnson said Lake City's budget for this coming year, not counting the expense for the new wastewater treatment plant, is about $35,000,000. 

According to CM Johnson, next year's millage rate will be 3.9816.  

Next year's fire assessment rates will remain the same. The fire department has incurred an additional cost of $98,000 due to the EMS-Lifeguard Ambulance agreement. This amount will be subsidized from the general fund, said CM Johnson. 

The fire department will be subsidized from the general fund to the tune of "$370,000." 

CM Johnson explained that in 2010-11 he had brought the subsidy down to $270,000. "We will gradually start going the other way," he said.

While the County has claimed that EMS will run subsidy free, every time one turns around there seems to be tax dollars going to support EMS.

The City also picked up a new expense -- the EMS dispatch cost to the County.

CM Johnson concluded telling the Council that he has prepared a budget analysis which compares the last six years of city budgets. 

City budget workshops are scheduled for July 26, 27 and 28. 

Mr. Johnson said about the 2012 budget, "There is no smoke and mirrors -- it's the real deal."

This work by the Columbia County Observer is licensed under a Creative Commons Attribution-Noncommercial 3.0 United States License.

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