Clerk/Treasurer Cathrene Behre...
HOLLY, Michigan – Holly council members had to dig deeper into the village’s coffers Tuesday night after learning that the village is nearly $49,000 over-budgeted for its fiscal year 2011-2012 budget.
With the fiscal year for 2011-2012 ending on June 30, Clerk/Treasurer Cathrene Behrens urged council members to take action.
“Going through the budget, what we’re showing right now is that we have a $48,000 overage that we are hoping within the next week to balance out,” Behrens began. “But potentially, we may not be able to, based on some of the numbers that have come in higher than we anticipated.”
Among the discrepancies, Behrens said health care costs for village employees came in much higher than anticipated, in fact nearly $100,000 higher than the amount for which the village had budgeted.
“Heath care costs came in much higher than anticipated and really hit us hard this year,” Behrens said. “It may require that more funds be taken out of the Capital Improvement fund balance if that is something council is willing to consider, but we’ve shut down spending completely, and this is as close as I can get.”
Adding to the skyrocketing costs of health care, Behrens said projected tax revenues for 2011-2012 came in lower than anticipated, causing a lack of tax adjustments to be done during the year. “It hit our taxes kind of hard,” Behrens said. “But those were some of the deficits.”
Additionally, Behrens said that the village had budgeted $12,000 for the tax adjustments as it had in previous years, but for 2011-2012 wound up spending $42,000. “That’s due to the utility company settlements that have come in during this fiscal year and that was something that you just didn’t know when it was going to hit because it’s been an ongoing thing elsewhere in the state with the tax tribunals.”
Earlier this month, council members approved an expenditure of $13,176 from the Capital Improvement fund to bridge a gap in the 2012-2013 budget as part of the plan for eliminating the possibility for layoffs in the police department. Taking an additional $48,445 out of the Capital Improvement fund would leave it with a balance of $12,133.
Village Manager, Jerry Walker.
Village Manager Jerry Walker lauded Behrens for bringing the matter to the council’s attention.
“Ms. Behrens is working extremely hard, crunching numbers and seeing if we can find additional revenues or tighten up some expenses,” he said. “The fact of the matter is, we just don’t know yet, but I think it’s very up front of her to come to council and say, ‘Look, this is the last meeting of the year – this is the situation and we’re short,’” he added. “We ended up with over $100,000 above in medical costs which no one could foresee – it’s just an uncontrollable factor.”
Village President Jeff Miller said the village is left with very little choice. “We can approve the budget amendments but knowing we may have to go back and do what is necessary to keep this village afloat,” Miller said referencing the possibility for police department layoffs in the future. “We can’t say right now that we promise to do this or do that – we have to cover a shortfall, it’s pure and simple because it’s the law.”
Councilwoman Jackie Campbell’s motion to take the necessary funds from the village’s Capital Improvement fund was seconded by Councilwoman Pauline Kenner, and the motion was unanimously approved.
In addition to the $12,133 balance in the village’s Capital Improvement fund, the village has approximately $150,000 available in undesignated fund balance.