Budget director provides insight on fiscal year budgeting process
JACKSON, Tenn. — As the budget discussion for the City of Jackson continues, we aimed to get more insight on how the budget process works for a city comparable to Jackson.
Ahead of the budget committee meeting that will be held Thursday afternoon at 1 p.m. in city hall, we looked to gain more information on the budget process. In order to do this, we reached out to the budget director in Johnson City.
According to tennessee-demographics.com, Johnson city ranks just above Jackson in population, with around 5 thousand more people.
Johnson City, has already voted on and accepted their budget for the next fiscal year. Their total expenses are just shy of $92.5 million.
Compared to the City of Jackson, whose total expenses on the current proposed budget are just shy of $99 million. Almost $7 million more than Johnson City which is a bigger town.
We were able to ask Dustin Thompson, the budget director for Johnson City, some questions regarding their budget.
The first one was about salary increases for city employees for next year. Thompson said the city funded a 3% pay plan adjustment/COLA, which is a cost of living adjustment, for their employees. Additionally, he said they have funded merit increases based on employee evaluations and that most of them could see an additional 2% increase. In total, most Johnson City employees could receive a 5% increase for this next fiscal year.
We also asked what their city normally uses their capital funds for. Thompson responded by saying it is normally used for equipment replacement, school and facility projects, and infrastructure projects.
We then asked about reserve funds, or rainy day funds. What would Johnson City deem as appropriate use for those funds? Would they ever use those funds in order to make up for a deficit in their budget?
Johnson City has a policy that dictates how much money must remain in that fund. The policy states that the city must maintain 20% of all operating obligations in a rainy day fund. The higher the obligations, the higher the fund must be. Any funds that exceed this policy, may be used only when their city commission approves.
It is not clear if the City of Jackson has any policy on the minimum amount that must be kept in the reserve or what’s commonly called rainy day fund. In fact, the city has used that fund to balance the budget in FY 23, FY 24 and is proposing to take $3 million from it in FY 25.
Finally, we asked what the city does to ensure they are bringing in more money that they spend.
Thompson started his answer to this question by saying the city does not use their fund balance for operating expenses. He goes on to say that cuts are made in the budget to ensure operating revenues cover their operating expenses.
We initially reached out to Johnson City just after 9 a.m. Tuesday morning. They responded back to us with these answers just four hours later.
To find out similar information from the City of Jackson, we were asked to submit public records requests and had to provide a copy of our driver’s license to submit the requests.
The City of Jackson let us know Wednesday afternoon that we our request for information has been completed. We will bring those details on Thursday.
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