Wednesday, August 22, 2012
Editorial Board, August through January 2012
- Scott Stanford, general manager
- Brent Boyer, editor
- Tom Ross, reporter
- Shannon Lukens, community representative
- Scott Ford, community representative
Contact the editorial board at 970-871-4221 or editor@SteamboatToday.com. Would you like to be a member of the board? Fill out a letter of interest now.
An intriguing recent Steamboat Springs City Council budget discussion should lead to two separate but equally important outcomes: The city should continue to budget conservatively as it heads into 2013, and it should formalize a plan for future surplus revenues.
The city already is in the process of budgeting for 2013, with the council scheduled to sign off on a final budget in October. That fast-approaching deadline led to a worthwhile discussion in Centennial Hall during the council’s Aug. 7 meeting. At the heart of the discussion was whether the city has been too conservative in its revenue projections in recent years, and how the city should earmark future surplus revenues.
Councilman Kevin Kaminski was appropriate to question the value of the city missing the mark by such a wide margin in its revenue projections. While erring toward the conservative is significantly better than the opposite, it also can lead to an expectation of surplus revenues midyear and the resulting rush for supplemental budget requests, pressure from groups inside and outside city hall and potentially haphazard spending decisions. We don’t intend to suggest the city has been irresponsible with its extra revenues in recent years but rather that a clear policy direction from the council for how such revenues should be allocated would alleviate the potential for future missteps.
As has been expected for several years, 2013 will be a particularly difficult budget year, in part because of the onset of significant annual payments on the city’s Iron Horse Inn debt. Adding to the challenge are rising health insurance costs and an uncertain national and global economy heading into another ski season. Plus, the city has been deferring important capital projects in part because of a significant decrease in revenues from the building use tax.
There certainly are benefits to budgeting conservatively. For one, the city has been able to build its reserves, though it’s likely that next year’s $433,000 Iron Horse Inn payment and capital improvement needs will bite into them. That said, the city’s reserves are at a healthy level but could stand to be even healthier in terms of accepted municipal accounting practices. Lest we forget, reserves are there to protect the city and its residents from operational shortfalls during times of emergency.
Let’s be clear: More cuts likely are coming to Steamboat Springs city government. Accurate yet conservative revenue projections are appropriate, as is a policy for how to allocate any potential surplus revenues that come in during the year. More likely than not, any “extra” money will be needed to play catch up on necessary expenditures that have been curtailed since the onset of the Great Recession.