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Marion looking at $174M budget for new fiscal year
Proposed budget includes six new firefighters, transit expansion delayed
MARION — The City of Marion’s budget for the new fiscal year will reflect challenges that have come with the city’s growth over the years.
The proposed fiscal 2024 budget was presented to the Marion City Council on Friday morning at Fire Station 1 on the city’s north end. During the meeting, council members voted to support the hiring of six new firefighters and also delay expanding public transit by a year.
A $174 million expenditure budget is proposed for fiscal 2024, which begins July 1 and ends June 30, 2024. The number is larger than this year’s current $113 million budget, which is due to a “big capital project year,” according to Assistant Finance Director Brian McKenzie.
“This is a big year. There were projects that were delayed, public service facilities and the fleet. It's our largest year yet,” McKenzie said.
The total recommended expenditures for the general fund — the chief operating fund for the city — is $31.5 million
The recommended expenditures in the capital fund, typically used for construction and purchases, is $69.1 million. Included is money for the Public Services Department facility, Uptown Plaza and Depot development, the Alburnett Road extension, continued Tower Terrace improvements, Indian Creek trunk sewer improvements, continued Seventh Avenue streetscape work and neighborhood streets reconstruction.
The public services building is the largest project by far, coming in at $27.2 million. The next largest is the public services fleet upgrades at $5.7 million.
The proposed property tax rate to support the new budget is $15.10 per $1,000 taxable valuation, up from this year’s $14.34 rate. However, not expanding transit will decrease the levy by around 21 cents from the $15.10 amount.
“The rate includes six additional firefighters, public transit and other public safety pieces like wage considerations for police and other rising costs with technology and typical expenses,” City Manager Ryan Waller said.
The increased rate would mean the owner of a $300,000 house would pay an additional $252 per year. Commercial property owners whose property is valued at $1 would pay an additional $47. Owners of multi-residential properties would see a tax decrease.
Waller said most of the city’s estimated $478,000 in new revenue could be eliminated if the Iowa Legislature advances a bill that seeks to correct an error made in the state’s property tax rollback calculations.
To fix an oversight in the process, the governor’s office and the Department of Revenue recently filed a bill in the Senate that carves out all former multi-residential properties from calculating the property tax rollback rate for 2022 residential property tax assessments.
“This change would wipe it all out and we would basically only get $41,000 in new revenue in a time where we need to fund police and fire,” Waller said.
“This legislature is acting so different than they have in past years and it's scary,” council member Steve Jensen said.
“If we tried to do that kind of style of legislation, we would be criticized greatly,” council member Grant Harper added.
Public safety accounts for nearly $2.2 million of the $3.5 million increase in expenditures as the fire department looks to add six new firefighters/paramedics in the next fiscal year.
“Our standards of cover are not fully staffed so we are expending almost 100 percent of our overtime budget by the end of this month and we have half of the fiscal year left,” Fire Chief Tom Fagan said.
The budgeted amount for overtime this year was $150,000. The current estimate for how much will be spent by the end of this fiscal year is $240,000.
“The overtime issue has been an issue for years since I’ve been on council. We talk about it every year, but we’ve done nothing to fix it so it’s time we focus on it,” Mayor Nick AbouAssaly said.
Though it's not included in this year’s fiscal budget, the department is also looking at relocating Station 3 farther south while also looking for land for a new fourth station. Fagan said the department’s priority is to relocate Station 3 first.
The city’s police department is looking at an increase in its annual budget as well, from just over $8 million to $8.8 million.
Police Chief Mike Kitsmiller said the department isn’t looking to increase the number of police officers, but is trying to fill its 48-officer roster.
“We've been at 48 for five of the past 37 months. During those times, we had somebody in the academy, which renders them not on the street. We’re sitting at 43, which is the lowest we've been in three years,” Kitsmiller said. “Most that have left have been for family reasons and larger pay elsewhere.”
“While we are not adding any new police officers, it's about ensuring the compensation is market competitive so we can retain and attract,” Waller said.
The city council is on board with delaying expanding the city’s local public transit, which has been discussed over the past year, and sticking with the current service.
The new transit system would have extended the bus route along First/Seventh Avenue through Uptown Marion and loop back with a 15-minute frequency through Uptown.
“This is enhancing a service, not creating a new one,” Jensen said.” Based on the magnitude of this budget, that's one thing I would delay,''
Providing no change to public transit will decrease the proposed tax levy by 21 cents.
Marion’s current transit service, contracted with Cedar Rapids, has around 500 to 550 riders per month. The route is a one-hour circular route in Marion. Marion has a contract with Horizons for after-hours ride service.
The plan also would have added three micro transit buses. The city had set aside $225,000 in federal American Rescue Plan Act dollars to buy three, 16-passenger buses for the micro-transit piece. The city could still use the ARPA dollars toward the buses if they obligate and spend the money before federal deadlines.
The conversation on public transportation in the metro area started last year, with Cedar Rapids initially planning to raise the cost of its agreement with Marion by more than $100,000 to about $535,000 annually. With the after-hours service added, the total cost would have been $567,205 for Marion. Later, after figuring out its state and federal transportation funding, Cedar Rapids revised Marion’s cost to $431,000 for the next fiscal year.
The cost of the new preferred option was less — $402,095. Adding micro transit, which includes $150,000 for the annual capital replacement cost of a bus, would’ve raised the total cost to $961,775.
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