Officials from the City of Hattiesburg have proposed a balanced budget for the first time in 10 years, although residents inside the Hattiesburg Public School District may see a very slight increase in property taxes if the Fiscal Year 2020-2021 budget passes.
The budget was proposed during the Aug. 8 meeting of Hattiesburg City Council and should be voted on within the next week. It features a total millage of 119.21 – up from last year’s 117.2, with the increase going to the school district – which would mean a yearly increase of approximately $19.80 on a home worth $100,000.
“The increase is not due to them asking for an increase in their budget – they are asking for the same dollars,” interim chief financial officer Connie Everett said. “For Fiscal Year 2020, the assessed valuation for the school district portion actually decreased, so the levy was not sufficient to produce the dollars that they requested.
“For Fiscal Year 2021, the initial roll I had for the school district area had very little growth in it; essentially a mill is going to be worth the same as it was for Fiscal Year 2020. With their dollar request being the same, there’s no way the same millage was going to produce their request for Fiscal Year 2021.”
The proposed budget is set at approximately $150.93 million. Of that, an estimated $54.74 million will go to the general fund, $24.68 million will go to special revenues, $36.78 million will go to capital projects, and $54.52 million will go to water and sewer.
About $25.6 million is subtracted from the budget for transfers.
“This budget is one that is a culmination, both of our current circumstances in dealing with uncertain revenue outlook with COVID-19, and also one that represents a remarkable accomplishment for the City of Hattiesburg,” Mayor Toby Barker said. “This is the first structurally balanced budget in 10 years.
“For the past nine budget cycles before now, the city has adopted budgets with planned expenses that outpace expected revenues. As you know, this is something we’ve been chipping away at for the past three budget cycles. Up until now, the city has found a way to balance its budget by either not spending everything it planned to spend or rolling over ending cash into the next year’s revenue numbers.”
Special revenue funds include $3.5 million for parks and recreation, $3.61 million for special sales tax funds, $970,000 for the Internet sales tax fund and $184,000 for special street improvements. About $7.85 million is set aside for municipal roads and bridges, followed by $3.95 million for mass transit and $2.38 million for community development block grants.
Capital projects funds include $2,302 for Kamper Park improvements, $33.6 million for the upcoming Hattiesburg Public Safety Complex and $3.17 million for construction of the new fire station on U.S. 49. The general fund includes $9.3 million for administrative, $12.8 million for police and academy, $9.3 million for fire and $12.9 million for public services.
“The practice of passing structurally balanced budgets and then hoping for the best is a really bad way to run a company, because it fails to tell the real story of the city’s financial health and budget practices,” Barker said. “It also hinders us from developing a sustainable approach to growing cash reserves that can be used during economic downturns or following a natural disaster.
“Getting into structural balance moves us back to an even starting point. It is a tremendous accomplishment, and one that all (the council) had a part in.”
The proposed millage of 119.21 includes 58.33 mills for the general fund, 58.33 mills for school district maintenance, 2 mills for parks and recreation, 1.95 mills for municipal bonds and interest, and 4.5 mills for police and fire retirement.
“We are now better prepared for uncertainty as it relates to revenues that will come during the winter months, when COVID cases are expected to rise,” Barker said.
