Budget Message
2022 Strategic Goals
2022 Overview
Department-Fund Relationship
BUDGET FUNDS DISCUSSION
There are 10 funds for which forecasts are prepared for both revenues and expenditures. Presentation of each fund includes line item detail of revenue, expenditures, and fund balances for each year to include 2020 actual results, 2021 estimated, and the adopted 2022 budget. Each department within the fund is also separately presented. The Enterprise Funds (Water and Wastewater) include an administrative allocation from the General Fund.
Major Funds Overview
The “Major Funds” of the City include the General Fund, the Streets Fund and the Enterprise Funds (Water and Wastewater Utilities) which constitute 91.5% of the resources in the budget.
General Fund
Revenues accounted for in the General Fund include sales taxes, various user charges, state and county shared revenues and grants, and investment earnings totaling $12.2 million. The Fund’s expenditure budget for 2022 totals $13.1 million, including supporting transfers to other funds totaling $846 thousand.
The 2022 Budget will leave a reserve of at least $2.5 million of unrestricted funds at the end of the year in the General Fund, exceeding the City’s Fund Balance Reserve Policy target for minimum level of reserves of 25% of previous year operating expenses.
Streets Fund
The Streets Fund was created in 2016 to track specific expenditures mandated by the Salida Municipal Code related to dedicated sales tax dollars necessary for street improvements. No less than thirty two percent (32%) of proceeds received from the City’s three percent (3%) sales tax are to be deposited into the Streets Fund and must be used solely for the construction, operation, maintenance and repair of City streets and related infrastructure. Streets are the most highly used amenity of the City and the funding model strives to keep them in top shape.
Water and Wastewater Funds
The Water and Wastewater Funds were established as enterprise funds in conformance with Colorado Revised Statutes in order to provide for the operation and maintenance of the City of Salida’s water and wastewater systems. Revenues for these funds are comprised of service fees for delivery of water and wastewater services, system development fees, and various non-operating revenues such as grants or debt proceeds. Typical expenditures include normal operating expenses, improvements and repairs to the distribution and collection systems, upgrades to the water and wastewater treatment facilities, and the repayment of debt obligations. Two large projects are in the works: the Gallery transmission line replacement and the Pasquale Springs Improvement. These projects are funded with low interest debt issued in 2021 via the Colorado Drinking Water Fund.
NON MAJOR FUNDS OVERVIEW
Capital Improvement Project (CIP) Fund
The Capital Improvements Fund was created in 2016, receiving up to eight percent (8%) of the proceeds received from the three percent (3%) City of Salida sales tax. Revenues received by this fund are to be used for capital improvements (other than streets). There are projects anticipated at a cost of $1.2M in 2022, balanced against revenues of $0.9M along with a transfer from the Conservation Trust Funds in the amount of $280K.
Conservation Trust Fund
The Conservation Trust Fund (CTF) was created to manage funds received from the conservation trust fund of the State of Colorado. CTF funds can only be spent for the acquisition, development and maintenance of new conservation sites and recreational facilities as defined in the Colorado Revised Statutes. In 2022, the City plans to use CTF funds accumulated over several years for various parks and to assist Salida Mountain Trails with trail expansions in the area.
Economic Development Fund
The Economic Development Fund was created in 2016 for the purpose of supporting affordable and sustainable housing; to support efforts to improve the standard of living of the community through the creation of jobs, the support of innovation and new ideas, and the creation of greater net wealth; and to support improvements to the quality of life in Salida. A special election in 2018 allowed for increased diversion of sales tax from up to two percent (2%) to up to ten percent (10%) of the three percent (3%) sales tax collected by the City of Salida to be placed in the Economic Development Fund. For purposes of the 2022 Budget, the amount of sales tax diverted into the Economic Development Fund will remain at two percent (2%) of generated sales tax, or $191,500.
Lodging Tax Fund
The Lodging Tax Fund was created in 2016 to accept revenues created by the levy of an occupation tax on the business of leasing or renting rooms or other accommodations within the City of Salida pursuant to the Salida Municipal Code. These revenues are to be used primarily for capital improvements and operational expenses for parks and recreation and arts facilities in the City, including the Salida Hot Springs Aquatic Center and the SteamPlant Event Center. Revenues for the fund are projected to increase to $516,000 in 2022 and the tax rate is expected to be set at the total amount approved by Citizens which is $4.82 per room night.
Housing Fund
The Housing Fund was created in 2020 for the purpose of accounting for inclusionary housing fees approved by Council in 2018 (Ord. No. 2018-14). For 2022, a contingency has been budgeted in the amount of $152,000 in case a housing project that meets the criteria under Article XIII of the Salida Code of Ordinances is identified.
Personnel
Typical to an organization providing services as its main commodity, personnel costs are the single highest expenditure in the budget representing 32.1% of all spending. Below is a table displaying the full-time equivalent (FTE) actual staff count by department for 2020, 2021, and the budgeted amount for 2022. Actual part-time staff hours have been converted to full-time equivalent positions and included in the information below for comparability.
For fiscal years 2020 and 2021, averages have been used based on actual payroll data and capture any vacancy savings. The 2022 budget numbers reflect full employment counts.
A market pay analysis is in the works so the City can be assured that it is paying competitive wages. An estimate of $500,000 has been placed as a placeholder in the budget to fund possible wage adjustments recommended by an impartial outside consultant that will perform the review.
For 2022, the budget includes 7.5 new employees:
- The Administration department has requested to add one employee, a Human Resource Manager
- The Police department has requested to add one employee, a Records Clerk. This position will manage the records function that the City previously contracted with Chaffee County Sherriff to accomplish.
- The Public Works division has requested to add one employee, a Mechanic specializing in emergency vehicles.
- The Arts & Culture division has requested to add one and one-half employee, an Event Coordinator and a Community Outreach Coordinator.
- The Parks & Recreation division has requested adding 2 employees, a Facilitator for recreation programming and a Facilities Worker for maintenance.
- The Water & Wastewater Utilities have requested 1 shared employee, a Municipal Worker.
CAPITAL PROJECTS
Capital projects are large projects that involve constructing new infrastructure (i.e. streets, water or sewer lines), a new facility or a significant facility or infrastructure improvement. Cost is typically greater than $50K and can involve planning and multiple contractors. Larger projects can take multiple years to complete. It is the City’s practice to budget for the entire project’s cost so the total funds necessary are clear. Budgeting for a project that takes multiple years to complete entails “rolling over” the unfinished cost portion into the next budget period. If necessary, it is appropriate to use fund balance reserves as a funding source for projects as the cost is not ongoing.
The 2022 budget for capital projects includes some new requests as well as some rolled over projects. Sometimes the budget estimate changes as more clarity is gained during planning efforts so in some cases the rolled over budget is higher than the original. The below map shows the location of projects proposed in the budget and text below the chart provides some details on the most significant project requests.
Street Rehab Projects
Street rehabilitation projects planned for the next year include paving and pedestrian improvement projects and other safety upgrades at 10th and 12th Streets, block of 3rd between E and F
Project Budget: $1,700,000
Highway 50 Streetscape Project
Safe Routes to School (SRTS) and other sidewalks on US50 to Walmart, Holman, Stryker to include a US50 pedestrian crossing. Cost is $1,000,000 with an $800,000 grant offset.
Project Budget (net): $200,000
Splash Pad
A splash pad feature to be added at Centennial Park. This project will also provide the infrastructure for bathroom improvements to be done in the future.
Project Budget: $350,000
Gallery Transmission Main Water Line Replacement (Rolled over from 2021)
The aging piping critical for distributing potable water from Salida’s primary groundwater source to the City will be replaced, further ensuring a dependable water source for all residents.
Project Budget: $1,900,000
Pasquale Springs Improvements (Rolled over from 2021 at an increased cost)
Much of the aging infrastructure necessary for the treatment, storage and pumping of spring water into Salida’s water system will be replaced, expanding the capacity of the Pasquale Springs site and providing greater resilience in the event that the treatment plant becomes inaccessible.
Project Budget: $2,500,000
Other Projects
The budget includes recommended funding for many other projects to include the Scout Wave replacement ($100,000), various upgrades at the Aquatic Center (new floor, temperature controls, boiler, highway sign-$245,000), study and design work for the downtown skatepark (Spirit of Salida) which MAY be converted to an art plaza ($100,000), expansion and relocation of the mechanic shop to the multi-use facility ($100,000), design and site work for a new firehouse, and restoration of the caboose in the F street parking lot ($150,000 with potential for a $100,000 grant offset).
Summary
