Councill hears sobering update on sales tax revenue, budget workshops coming soon

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by A.C. Hall

Last week the White Settlement City Council held a workshop on the mid-year budget.  At this workshop, City Manager Jim Ryan and Assistant City Manager Jeff James delivered some sobering updates and projections on the sales tax revenue the City is bringing in.  Sales tax revenue accounts for around twenty percent of the city’s overall revenue.  Ryan started the meeting by saying the steep declines in the oil and gas industry has struck the City severely.  The largest sales tax payer in the city is involved in the oil and gas industry and has seen their sales tax revenue drop as that industry continues to decline.  Overall, the city has seen sales tax revenue drop for ten months straight and it is consistently falling below projections.  Ryan said they tried to anticipate these trends when making the budget.
“We didn’t know how badly it was going to end up,” Ryan said.  “I never knew how dependent we were on the oil industry.”
As James took over the workshop, he tried to calm fears that council members might be having.
“I’m not saying that this is the end of the world for this city,” James said.
He shared some of the reasons why the city is being impacted so severely by the oil industry’s decline.
“We need to have a diversified economy in our town.  Unfortunately, we do not have a diversified economy,” James said.
Some ways to make up the lost sales tax from oil and gas industry businesses were discussed.  James spoke about trying to diversify the local economy while also attempting to make up the lost revenue with the growth of existing businesses and the opening of new businesses.
James also spoke to the council about their influence on the budget.  The recent budget process was brought up, as James referenced the strong push back they received when talking about cost cutting measures that would’ve saved money.  One such measure was a proposed lowering of the Library hours, something council eventually did away with after receiving ongoing push back from members of the community.  James challenged the council not to make budget decisions based on political gains and their own desires to be re-elected, saying they should put extra thought into spending money and making promises to the residents that will cost money.
“We need to focus on our future,” James said.  “What we really need to focus on is how we’re going to pay for things, how we’re going to help our city.”
As he continued, James spoke about the need to cut back and avoid running the city into debt.  He mentioned the heat they take when they make cutbacks, using the recent Christmas event as an example.  James said that several complaints came in because the city didn’t offer free food at the event, but said it was a decision that was made in an attempt to be a good steward of the city budget.
“It is our responsibility to do right by the taxpayers,” James said.
As discussions turned towards the future, it was stated that the city projects bringing in $1.8 million in sales tax revenue this year.  That number is projected to stay the same over the next five years.  This was identified as a concern, as it’s down from the $2.1 million the city brought in last decade and could look stagnant to businesses considering opening in White Settlement.
“We have a plan to get through this,” James said.  “We need to be super proactive.”
As the need to stay sound in spending was identified, Ryan said they were looking at ways to cut in every department.  From cutting expenses, freezing open positions, outsourcing fleet maintenance, and limiting the number of employees who take home vehicles, Ryan said they’ve already identified $800,000 in cuts.  Many of those cuts are already being implemented.
“That doesn’t mean we can go out and have fireworks or feed the multitudes,” Ryan said.  “We’re going to need to tighten our belts.”
Ryan echoed the words James had shared earlier, urging council to keep all of this in mind when the next budget is planned and when they’re making spending decisions.
“There are good things coming,” Ryan said.  “We’re going to make it through this but we have to be responsible.”
Council member Steve Ott voiced his support for this plan, saying that just like making a budget for your household, the city needs to only spend what it makes.
Council member Elzie Clements spoke about the openness he has towards ideas that anyone has that could help the city.
“The council is receptive to anybody’s ideas,” Clements said, encouraging citizens to reach out if they have thoughts or ideas.
As the meeting wound down, council member David Mann questioned why so many cities in the area are blowing up and doing well but White Settlement isn’t.
“We’ve had good things happen, but not enough to offset the things going on in the oil industry,” Ryan told him.
Workshops for next year’s budget will begin this summer.