Borrowing money sends recreation over budget

Published 12:00 am Saturday, March 14, 2009

NATCHEZ — Robbing Peter to pay Paul has sent the recreation department over its budget.

This fiscal year, the recreation department has taken out three interfund loans to balance its budget month-to-month, for a total of $80,060.

An interfund loan transfers money from one area of the city’s budget to another, which is normal practice, Recreation Director Ralph Tedder said.

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He said the loans have come from the city’s general fund.

Tedder anticipates taking out two more loans of $18,000 and $11,600 for a projected total of $109,660.

However, the recreation department is being repaid $14,660 this fiscal year from a previous loan, which brings the total of interfund loans to $95,000.

Each year, the city provides an interfund loan budget, and Tedder was operating under the belief that he had a budget of $95,000.

City Clerk Donnie Holloway said each year an interfund balance is budgeted for the departments that generate revenue.

However, Tedder was operating this fiscal year under a $95,000 interfund budget from 2005 because of Hurricane Katrina.

This fiscal year, the interfund budget is only $75,000, which means the recreation department is $20,000 over budget.

Tedder said he has been borrowing money to balance the budget because he’s operating on a budget that’s been cut back over the years.

In the 2006-2007 fiscal year, his budget was $1.21 million. In the 2007-2008 fiscal year, it was $1.17 million. This fiscal year, it was pared down to $1.04 million.

And revenue has been decreasing over the years as well, he said.

The recreation department is one of the few departments in the city that creates revenue, and through several different avenues — fees, ad valorem and concessions.

At the beginning of the fiscal year, Tedder said the amount of ad valorem revenue is projected, and the actual income inevitably ends up falling short of the projection.

Two fiscal years ago, the ad valorem revenue was projected at $218,344 and fell short by more than $18,000.

In the 2007-2008 fiscal year, the ad valorem projection was set at $218,992 and was actually only $204,311.

This fiscal year ad valorem revenue is projected at $215,940.

Golf course fees are another major source of revenue — with $200,000 worth of collections projected.

But just like ad valorem revenue, golf revenues have been dwindling, also.

Over the past 12 fiscal years, golf hits its peak in 2001-2002 at 27,110 rounds played.

This past fiscal year, only 13,532 rounds of golf were played, a near 10,000 drop from the previous fiscal year.

This fiscal year, out of the $200,000 projected revenue for golf fees, $47,231.50 has been collected so far.

Tedder said part of 2008 decrease is hole closure due to Hurricane Gustav and the Dec. 9 tornado.

Tedder said he’s being careful in his expenditures.

“On our expenditures, we’re doing really well,” he said.

Two employees were cut from the budget at the beginning of the fiscal year — a golf clerk and a tennis clerk.

Tedder also said he has a system of checks and balances set up for reviewing invoices to make sure no unnecessary purchases are going through.

“My staff’s been doing an excellent job in not buying things that aren’t needed,” he said.

Also for the golf course, $24,000 was budgeted for gas, and in the first quarter of the fiscal year, only $4,735.55 has been spent.

He said money could be shifted around from the fuel line item, but he can’t make a call right now on how much money will be saved there.

“Our biggest expenses are yet to come,” he said.

Spring and summer call for heavy maintenance, Tedder said.

The most likely place to cut, Tedder said, is personnel.

Salary and benefits take up nearly 60 percent of the recreation’s budget.

“Reduce services and reduce personnel — that’s all that left,” Tedder said.

Tedder has 20 full-time employees and four seasonal program employees.

Alderman Dan Dillard, who chairs the recreation department, said one option for cutting back on personnel is not layoffs, but reducing the work year.

“We may hire a percentage of staff more seasonally,” he said.

Dillard said because a lot of work done for recreation — like grass cutting — is done during spring, summer and early fall, workers could only work during the peak season.

“I think there are ways that we could do things more efficiently and cost effectively,” he said.

A few months ago, the board of aldermen voted to raise golf cart fees, green fees and tennis court fees by a few dollars.

The fee hike began Feb. 1.

By raising the fees, Dillard and Tedder said they would hope to create a new position at the golf course — a golf marshal.

Tedder said money would be spent paying the golf marshal, but it would only be a part-time job with no benefits.

And Dillard said you have to spend money to make money.

“It would be a revenue generator,” he said.

Sometimes people sneak onto the golf course and play a round without ever paying, he said.

“There is a certain amount of our revenue that is being lost because of not being able to oversee all of the play,” he said.

Also, Dillard said a golf marshal would keep the play from being stagnant, therefore moving more players through within the course of a day.

“Another aspect of the marshal is to keep (golfers) from tearing up the course,” he said. “You can have somebody drive a cart on the green and they can do $10,000 worth of damage.”

The city enacted a case-by-case-basis hiring freeze on Tuesday.

Mayor Jake Middleton said he isn’t against hiring a golf marshal, but he would like to get the board’s approval first.

All in all, Tedder said with the mid-year budget review coming up at the end of this month, it will give him and the board of aldermen a chance to look at and rework the budget to get things in line.