Basalt officials: ‘Flat’ is good next year
BASALT ” Basalt will take a cautious but not panicked approach to its town budget in 2009.
The Town Council endorsed a draft budget last night that assumes revenues will be flat compared to 2008. But finance director Judi Tippetts said she sees no evidence at this point that the town’s sales tax revenues will drop.
“I don’t think the sky is falling,” Tippetts told the council members. “I think going flat, we’re good.”
She noted that “people have to eat” regardless of how tough the economic times get.
Sales tax collections from retail food stores comprise 38 percent of the town’s sales tax revenues.
Supermarket sales show no signs of slowing. Three-quarters of the way through the town’s fiscal year, the government has collected just over $1 million in sales taxes from retail food establishments. City Market is obviously the major contributor. That is up 7.4 percent over the same period last year.
The city of Aspen is anticipating only a 1 percent increase in sales tax revenues next year. The towns of the Roaring Fork Valley depend heavily on spending by tourists and the sales taxes that generates. If the national economy tanks and fewer tourists travel, that affects local budgets.
The draft budget approved Tuesday night by the Basalt Town Council assumes total projected taxes of $4.93 million for next year, compared to $4.89 million this year.
The additional $36,648 will come from property taxes.
“We think flat is a pretty good spot,” said Town Manager Bill Efting.
General fund expenditures will rise from $5.91 million this year to a proposed $7.59 million in the draft budget for next year. However, the council and staff identified a few items they will pare out of the budget to reduce expenditures.
As proposed, the budget anticipates dipping into reserves for $877,300, but that deficit spending will be reduced by at least $130,000 before a final budget is approved later this fall.
The town will maintain a healthy reserve in case the economy craters, Tippetts said. It has enough cash on hand to operate for about nine months if revenue dried up. The legal requirement is three months.
Town employees won’t have to fear the recent gloomy economic news. The budget includes a 6 percent raise for the staff of 35. No new positions will be created next year.
Efting, who is leaving this fall, credited the department heads for frugality. They consistently take an approach that they don’t have to spend all the funds that are budgeted for their departments, he said. That helps the town carry over unspent funds.
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