City OKs $48.3 M Budget
Thursday, December 22, 2005
By RYAN DEZEMBER
Staff Reporter
ORANGE BEACH -- City officials predict that municipal revenue will exceed pre-Ivan levels next year, according to a 2006 budget unanimously approved by the City Council on Tuesday.
The financial plan reflects a 12-month period that will begin Jan. 1. Unlike most local municipalities, Orange Beach is using a calendar-year budgeting process rather than an Oct. 1 through Sept. 30 fiscal-year period.
A 16-page version of the budget is available online at orangebeachagenda.muniagenda.com/public/MeetingAgenda.aspx?meetingid=29. To download the document, click on the "attachments" icon beside the 2006 budget item.
In the introduction to the version presented to council members, Jeff Moon, city administrator, calls the $48.3 million budget "the most difficult and challenging" he's ever had to prepare because of the uncertainty in guessing how well the city's revenue sources will rebound after a year of recovery from the September 2004 storm, and providing for staffing and equipment needs without that knowledge.
Moon also wrote that the budgeting process was complicated by delays in receiving hurricane relief money, the difficulty of projecting which developments will be permitted in the coming year and trying to absorb the $18 million in land purchases made by the council in the last year.
Those purchases include a 5-acre tract on Terry Cove where a municipal marina is being planned, $6 million paid in October for the Orange Beach Golf Center on Canal Road and an 80-acre parcel along the Foley Beach Express which cost $4.85 million last month.
The city's 2006 revenue projections exceed $49.2 million, but that includes about $5.4 million in expected hurricane recovery money from federal and state agencies and a proposed $14 million bond issue that will be used to pay for the design and construction of the municipal marina as well as repay the city's coffers about $8 million used to buy the property and plan the facility, according to the budget.
Mayor Steve Russo said the city is likely to seek a 30-year bond and repay the debt with income generated by the marina.
Of the $49.2 million, officials expect the city to bring in $21.6 million from taxes, fees and other sources in 2006. According to the budget, a boost in the building permit and project design fees, a flurry of post-hurricane construction work and increasing property taxes will account for the $4 million and $5 million increases over that collected in the two previous fiscal years, respectively.
"We went back and looked at pre-Ivan numbers and predicted a very modest increase over that as far as lodging," Russo said. "Sales, we counted a little gain there.
"The biggest increase percentage-wise will probably be in permit fees, which is because the changes we made to elevate the rates there some."
Total spending -- which includes everything from the day-to-day operations of the city to debt repayment and capital expenses -- is slated to be about $48.3 million. That amount would absorb all but about $942,000 of the city's estimated revenue, according to the budget.
Among major capital expenditures planned for 2006 are the completion of Firehouse No. 2 on Canal Road, a new fire engine, equipment for the recently acquired golf course and driving range and improvements to the ball fields at the Orange Beach Sportsplex, including expanded seating that will help the city lure baseball and softball tournaments, Russo said.
The money city officials set aside for professional services -- money that pays outside lawyers, engineers and consultants -- is slated for $700,000, which is $425,000 more than was planned last fiscal year, but only about $107,000 more than was actually spent, according to city records.
"The reason for that large number is that we budgeted around an additional $300,000 for some work to go toward the Wolf Bay bridge," Russo said. "If it looks skewed a little bit that's why."
Also Tuesday, the council voted unanimously to let the mayor negotiate a deal with the Alabama Department of Transportation in which the city would give the state $2.7 million to use in acquiring rights of way along Canal Road as long as the agency promises to expedite the widening of the state route.
The road was scheduled to be widened beginning next year, but Transportation Department officials told local authorities recently that there is no money to buy the rights of way until 2007, which would push back construction until 2009.
City officials are concerned that without improvement, the oft-congested road will be unbearable by then because development now under way along Canal Road will be completed.
ON THE NET
Orange Beach 2006 budget:
orangebeachagenda.muniagenda.com/public/MeetingAgenda.aspx?meetingid=29
By RYAN DEZEMBER
Staff Reporter
ORANGE BEACH -- City officials predict that municipal revenue will exceed pre-Ivan levels next year, according to a 2006 budget unanimously approved by the City Council on Tuesday.
The financial plan reflects a 12-month period that will begin Jan. 1. Unlike most local municipalities, Orange Beach is using a calendar-year budgeting process rather than an Oct. 1 through Sept. 30 fiscal-year period.
A 16-page version of the budget is available online at orangebeachagenda.muniagenda.com/public/MeetingAgenda.aspx?meetingid=29. To download the document, click on the "attachments" icon beside the 2006 budget item.
In the introduction to the version presented to council members, Jeff Moon, city administrator, calls the $48.3 million budget "the most difficult and challenging" he's ever had to prepare because of the uncertainty in guessing how well the city's revenue sources will rebound after a year of recovery from the September 2004 storm, and providing for staffing and equipment needs without that knowledge.
Moon also wrote that the budgeting process was complicated by delays in receiving hurricane relief money, the difficulty of projecting which developments will be permitted in the coming year and trying to absorb the $18 million in land purchases made by the council in the last year.
Those purchases include a 5-acre tract on Terry Cove where a municipal marina is being planned, $6 million paid in October for the Orange Beach Golf Center on Canal Road and an 80-acre parcel along the Foley Beach Express which cost $4.85 million last month.
The city's 2006 revenue projections exceed $49.2 million, but that includes about $5.4 million in expected hurricane recovery money from federal and state agencies and a proposed $14 million bond issue that will be used to pay for the design and construction of the municipal marina as well as repay the city's coffers about $8 million used to buy the property and plan the facility, according to the budget.
Mayor Steve Russo said the city is likely to seek a 30-year bond and repay the debt with income generated by the marina.
Of the $49.2 million, officials expect the city to bring in $21.6 million from taxes, fees and other sources in 2006. According to the budget, a boost in the building permit and project design fees, a flurry of post-hurricane construction work and increasing property taxes will account for the $4 million and $5 million increases over that collected in the two previous fiscal years, respectively.
"We went back and looked at pre-Ivan numbers and predicted a very modest increase over that as far as lodging," Russo said. "Sales, we counted a little gain there.
"The biggest increase percentage-wise will probably be in permit fees, which is because the changes we made to elevate the rates there some."
Total spending -- which includes everything from the day-to-day operations of the city to debt repayment and capital expenses -- is slated to be about $48.3 million. That amount would absorb all but about $942,000 of the city's estimated revenue, according to the budget.
Among major capital expenditures planned for 2006 are the completion of Firehouse No. 2 on Canal Road, a new fire engine, equipment for the recently acquired golf course and driving range and improvements to the ball fields at the Orange Beach Sportsplex, including expanded seating that will help the city lure baseball and softball tournaments, Russo said.
The money city officials set aside for professional services -- money that pays outside lawyers, engineers and consultants -- is slated for $700,000, which is $425,000 more than was planned last fiscal year, but only about $107,000 more than was actually spent, according to city records.
"The reason for that large number is that we budgeted around an additional $300,000 for some work to go toward the Wolf Bay bridge," Russo said. "If it looks skewed a little bit that's why."
Also Tuesday, the council voted unanimously to let the mayor negotiate a deal with the Alabama Department of Transportation in which the city would give the state $2.7 million to use in acquiring rights of way along Canal Road as long as the agency promises to expedite the widening of the state route.
The road was scheduled to be widened beginning next year, but Transportation Department officials told local authorities recently that there is no money to buy the rights of way until 2007, which would push back construction until 2009.
City officials are concerned that without improvement, the oft-congested road will be unbearable by then because development now under way along Canal Road will be completed.
ON THE NET
Orange Beach 2006 budget:
orangebeachagenda.muniagenda.com/public/MeetingAgenda.aspx?meetingid=29
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