The first day of City Council budget reviews often have “uh-oh” moments.
That is, surprises — sometimes worth millions of dollars — that require members to make tough decisions on the city’s spending plan.
Council members are facing one early that could either end up taking several million dollars away from future Downtown development or leaving that same size hole in the budget.
Mayor Lenny Curry’s team swept $4.6 million in unused Downtown Community Redevelopment Area funding from the end of fiscal 2015 to balance next year’s budget. Pulling year-end funds from it and other such redevelopment areas across the city is required by state law.
However, council members and former Mayor Alvin Brown approved a local ordinance that placed the Downtown redevelopment money into a designated fund for the Downtown Investment Authority.
“We were unaware of that,” said Sam Mousa, Curry’s chief administrative officer who helped craft the mayor’s spending plan.
Mousa told the council Finance Committee on Thursday the decision was not intentional or malicious toward Downtown. Instead, it was an “honest oversight” that happened in the administration’s “overzealousness” in budget-making.
And when Mousa was told days after Curry presented his budget to council, he said it was an “uh-oh.”
Now, council members will have to make a decision: Should they waive the ordinance code and sweep the unused Downtown funding? Or do they leave it and find the $4.6 million elsewhere in city coffers?
There could be an option for the latter that wouldn’t pull from other already budgeted programs and services.
Council members could use money from the city’s fund balance, reserves of sorts that it keeps available. With a budget of Jacksonville’s size, a healthy reserve would be $50 million to $70 million. The latest projections have it at about $78 million.
It’s also anticipated to grow as much as $20 million more as revenue this year is higher and expenses are lower than anticipated. However, that’s based on third-quarter projections with another three months to go.
While Mousa didn’t advocate council take a position on the sweep it or keep it question, pulling from that fund balance would still leave it “healthy.”
Going that direction might be the way council members go, as several expressed a desire Thursday to leave the Downtown funds in place.
“The right thing is to come up with $4 million bucks,” said Bill Gulliford, who called it “the courage to do what’s right.”
Katrina Brown said she believed the money should stay in the redevelopment area, as money needs to be in place to help improve the urban core.
The DIA would like to keep the money for projects as they come online, said board chair Jim Bailey. He said that could range from the JEA generating site to the Laura Street Trio to even Hemming Park, once the administration and council decide on its future.
Bailey said he doesn’t see the situation as being adversarial and, as it always does, DIA will work the administration and council on the issue.
“The DIA is prepared to assist with a solution, but we aren’t prepared to be the solution," said Bailey, publisher of the Daily Record.
The redevelopment areas pull from increases in property taxes within that defined area for the purpose of being used there.
When generated revenue can’t cover debt service, however, the money to balance it each year comes from the city’s general fund.
Since 2011, the general fund has provided $15.7 million to the Downtown redevelopment area, council members were told Thursday.
The $4.6 million in question was left over as of Sept. 30, 2015.
It will be a decision for a future budget review hearing, as members deferred the issue until they could be addressed by council President Lori Boyer, who discovered the situation
She already has a meeting dedicated to redevelopment areas planned for Sept. 23.
Finance members did end up approving some items Thursday, including the Jacksonville Sheriff’s Office budget that includes 40 officers and 40 community service officers next year.
Budget hearings continue today and will take place twice a week until the end of August.
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