Next year’s proposed general fund budget for the city of Little Rock would keep spending essentially flat, with revenues and expenses balanced at about $222 million, Little Rock board members said during a meeting. of a budget presentation on Tuesday.
Compared to the original 2021 general fund budget of $210 million, the proposed budget for 2022 represents an increase.
However, the proposed budget maintains revenue and expenditure in line with the amended 2021 budget, which saw total general fund revenue revised to approximately $224 million and expenditure to nearly $222 million, for a net gain of nearly $2.3 million.
In all funds – they include the aforementioned general fund in addition to the street, waste disposal, fleet, vehicle storage and parking garage funds – the net income should be 1, $4 million, according to the 2022 budget proposal.
Board members will need to formally approve a proposed budget sometime before the end of the year.
The city’s chief financial officer, Sara Lenehan, made the presentation at Tuesday’s agenda meeting. At the beginning, she explained that needs that are not included in the budget can be met with other sources of funding if the council wishes.
Lenehan named the December 31 expiration of the three-eighth percent (0.375%) sales tax for capital projects, “which eliminates one of the main sources we’ve had for capital funding.” , she noted, as well as the April 2022 retirement of street and drainage bonds. An election in 2022 would be needed to renew those bonds and maintain a $3.0 million street and drainage tax past the end of 2022, according to his presentation.
Mayor Frank Scott Jr. had lobbied for a sales tax increase intended to fund quality-of-living improvements that would have raised the city’s overall shopping rate to 9.625% when factoring in sales taxes. State, county and local starting in January. .
The increase failed in a referendum on September 14. As a result, in light of the expiration of the three-eighth percent tax for capital improvements, the overall sales tax rate will fall to 8.625% next year.
According to Tuesday’s presentation, the forecast for the city’s local sales tax revenue was that collections would remain essentially flat, with $65.9 million in revenue projected for 2022, compared to $65.96 million in the amended budget for this year.
Little Rock also receives a 1% sales tax revenue share from the county, and officials expect the city’s revenue from this source to decline slightly in 2022 from the Amended 2021 Budget to a total of approximately $51 million next year.
Revenue from fines and fees is expected to increase next year by about 14.8% from the amended 2021 budget, Lenehan said, to a projected total of $1.93 million.
About 82% of the city’s general fund revenue is generated by a combination of sales taxes, property taxes and franchise fees, with sales taxes in particular providing more than half of general fund revenue, according to the presentation. of Lenehan.
General fund revenue before transfers is expected to top $220 million next year, up from $219.3 million in the 2021 amended budget. The figure represents an increase of $760,753, up 0.35% from compared to the amended 2021 budget.
The proposed budget for 2022 includes a general wage increase of 1.5%. The pay increase would be added to all step and grade progressions for employees covered by fire and police unions as well as the American Federation of State, County and Municipal Employees, plus operators of 911, according to Lenehan.
The cost of the salary increase was budgeted at $2.22 million.
Lenehan warned council members that the article could still be changed. She said officials were still negotiating with unions and considering whether additional revenue could allow them to raise wages further. She estimated the last pay increase for police and firefighters, beyond step and rank, came in 2018, while non-union and non-uniformed employees saw their last raises in 2017.
Police Department lieutenants and majors would receive an additional 1% pay increase as part of the 2022 budget “to address some of the compression issues they are having,” according to Lenehan. A recruitment incentive for the police is set to increase from $5,000 to $10,000 at a cost of $300,000, according to the budget proposal.
Personnel changes in the proposed general fund budget for 2022 would add 23 positions priced at nearly $2.3 million, according to the presentation, resulting in a total of 1,727 full-time positions included in the general fund.
Full-time staff in the Office of Executive Administration will drop from 28 to 30, not because of an actual increase, Lenehan said, but rather because those two positions are being consolidated from the Department of Community Programs to the Office of Diversity, Equity and Inclusion.
The city attorney’s office will get two positions after requesting an assistant city attorney and a paralegal, Lenehan said. Another position in the office will be upgraded from assistant to administrative office manager, she said.
In the Police Department, a net decrease of 60 positions in the 2022 budget is related to the transfer of 65 positions to the new Department of Emergency Communications, she explained. The police department will add three telephone reporting clerks, a county jail reimbursement position and a crime analyst position, Lenehan said.
Police, fire and 911 personnel make up 53.8% of the full-time workforce in all Budget 2022 funds, with 1,192 of 2,216 full-time employees, she said. .
In outside agency allocations, the Art Museum of Arkansas is expected to get a $400,000 increase next year due to its planned fourth quarter opening after a revamp. The city’s allocation for a local nonprofit, the Downtown Little Rock Partnership, will increase by $50,000 to encompass other annual contracts the city was paying for, Lenehan said.