EXPLORE HAMILTON’S PROPOSED BUDGET ONLINE
The City of Hamilton's 2016 proposed budget is available to view on the city's website. Click here to view
Residents can now get a look at the city of Hamilton’s 2016 proposed budget, as the $434,196,646 document is available on the city’s website, and it shows that operating revenues are sufficient enough to cover operating expenses.
The 2016 proposed budget is slightly higher than last year’s $323,400,759 budget, but Thomas Vanderhorst, Hamilton’s finance director since 2014, believes that the city has put together a fiscally sensible plan that compares well to the city’s 2008 budget, which contained higher revenues.
“The 2016 budget is structurally balanced, meaning that operating revenues are sufficient to cover operating expenses, however, the General Fund revenues are significantly lower today than they were in the high water mark of 2008 when revenues were $48,473,702,” he explained.
The 2016 budget forecasts revenues of $42,869,570 or $5,604,132 less than 2008. Using a straight up comparison of actual dollars, that is an 11.6 percent revenue reduction when comparing 2008 versus 2016 revenues according to Vanderhorst.
“Adding to that, the cost of delivering municipal services has become more expensive as fuel, health insurance and cost of labor have increased,” he said. “Taking those factors into consideration, we are delivering city services with $36,957,792 in 2008 constant dollars or about 23.8 percent less resources than we did in 2008.”
The public loves to hear about balanced budgets, but getting to that point often means with less revenue coming in and that is the case in Hamilton.
“Even though the budget forecasts a balanced budget, we are doing it with nearly 25 percent fewer dollars than we had available in 2008,” Vanderhorst explained. “This has been very difficult for the city because our largest cost and most valuable resource is our people. We have reduced staff and many have receive pay increases lower than the private sector over the eight-year time period we’ve discussed.”
The 2016 proposed budget will spend $57,740,043 in personnel and benefit costs for all funds, and estimates paying $1,683,152 in overtime for all departments. The city manager’s office will receive $354,909, the fire department $11,698, 107 and the police department $13,171.372 in funding from the 2016 proposed budget. Utilities will cost the city $339,595,963,
Vanderhorst does not believe any line item has significantly been changed from previous years.
“The 2016 is essentially a continuation budget for most city services with the biggest change being in the Electric Fund,” he said. “The 2016 Budget contemplates the city selling 48.6 percent of its stake in the Greenup hydroelectric facility to American Municipal Power(AMP) making our budget look significantly higher in 2016 when compared to other years. Other than that, the budgets for all funds is very similar.”
He added that, “police and fire budgets are very similar. Plans are to continue to keep the same number of sworn officers for both police and fire.”
When it comes to water sales, that adds an interesting line item to the budget. The 2016 proposed budget projects a total of $12,777,000 in revenues coming in from what is locally billed as the “World’s Best Tasting Water.” Of that amount, $7,930,000 comes from sales to customers, while $4,847,000 will be made from sales outside the city limits.
Vanderhorst said residents should still be happy with the city’s water deal with Butler County that was signed last year and runs through December of 2044.
The new contract decreases the county rate from $2.78 per thousand gallons to $1.66, and sets up the city of Hamilton to be the county’s sole provider of water.
The proposed 2016 budget will be voted on Wednesday, Dec. 9. Vanderhorst believes that all of the fiscal angles have been looked into and it should withstand any scrutiny.
“We are like all other Ohio cities reeling from the effects of the State’s reduction of the local government fund as we are forced to make tough decisions,” he said. “In many ways, this is just like the citizens and businesses we serve.”
And when one delves into the nuts and bolts of the proposed budget, Vanderhorst notes that it was created with the philosophy of how one might manage her or his own expenses.
“The highlight of this budget is that we are presenting a structurally balanced budget whereby operating revenues are greater than or equal to operating expenses,” he said. “That may not seem like a big deal, however, we have been using fund balance to make up the difference when expenses exceeded revenues and that timeline is limited. Doing that is like using your savings account to pay your mortgage. You can do it, but if your income exceeds your monthly bills every year, you need to either earn more or buy a less expensive house.”
He added a little extra fiscal insight: “Council and city administration have used fund balance, when needed, to keep services levels as high as financially possible but at some point we need to be structurally balanced before we totally exhaust our remaining rainy day fund balance. While this also may not seem like a big deal, it appears we may have hit the bottom.”
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