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Township may plan for deficit
By T.L. HAMILTON
Due to an increase in The Woodlands Fire Department 2009 budget and flagging sales tax revenue, The Woodlands Township may have to operate at a $2.3 million deficit in 2009.
The deficit may settle at $1.9 million due to savings related to the township’s decision to fund Regional Participation Agreements with the cities of Conroe and Houston with a bank loan instead of a bond sale.
It would be the first time the township would operate with at a deficit since its inception as The Town Center Improvement District, said Bob Kinnear, director, at the township’s first budget workshop Friday morning.
Of the deficit, $1.4 million will fund construction, equipment and staffing of the permanent Creekside Village fire station.
Also, 2008 sales tax revenue dipped $70,000 below expected returns for the month of September, coloring expectations for next year.
Sales tax revenue for 2009 is expected to be $1.5 million below what was originally expected, now falling to $26.1 million, said Brian Pate, financial consultant.
“We squeezed this lemon as hard as we could,” Pate said. “I think this $26.1 million (in sales tax revenue) is a realistic number and I think we’ve been extremely conservative in estimating it. I think it will probably be higher even given the current financial crisis.”
The 2009 budget may include a $28,517 increase in administrative costs related to more open meetings planned in the coming year.
Other costs include transitioning Monique Sharp, assistant general manager for Finance and Administration with the Community Associations of The Woodlands, onto the township’s staff during the last half of 2009.
Township President Don Norrell said he wished to gauge board directors’ comfort level with operating at a deficit and discuss the matter further in upcoming workshop meetings.
Most directors expressed discomfort with the idea of operating on a deficit.
“I prefer a balanced budget,” board member Peggy Hausman said.
Kinnear warned that the transition agreement prohibits the boards from cutting back on services to residents in their budgeting process.
“A lot of this is out of whack, but it’s what we have to do to maintain a level of service for this community,” he said.
The board plans to discuss the budget and any possible cuts at its next budget workshop meeting at 9 a.m. Friday.
The deficit may settle at $1.9 million due to savings related to the township’s decision to fund Regional Participation Agreements with the cities of Conroe and Houston with a bank loan instead of a bond sale.
It would be the first time the township would operate with at a deficit since its inception as The Town Center Improvement District, said Bob Kinnear, director, at the township’s first budget workshop Friday morning.
Of the deficit, $1.4 million will fund construction, equipment and staffing of the permanent Creekside Village fire station.
Also, 2008 sales tax revenue dipped $70,000 below expected returns for the month of September, coloring expectations for next year.
Sales tax revenue for 2009 is expected to be $1.5 million below what was originally expected, now falling to $26.1 million, said Brian Pate, financial consultant.
“We squeezed this lemon as hard as we could,” Pate said. “I think this $26.1 million (in sales tax revenue) is a realistic number and I think we’ve been extremely conservative in estimating it. I think it will probably be higher even given the current financial crisis.”
The 2009 budget may include a $28,517 increase in administrative costs related to more open meetings planned in the coming year.
Other costs include transitioning Monique Sharp, assistant general manager for Finance and Administration with the Community Associations of The Woodlands, onto the township’s staff during the last half of 2009.
Township President Don Norrell said he wished to gauge board directors’ comfort level with operating at a deficit and discuss the matter further in upcoming workshop meetings.
Most directors expressed discomfort with the idea of operating on a deficit.
“I prefer a balanced budget,” board member Peggy Hausman said.
Kinnear warned that the transition agreement prohibits the boards from cutting back on services to residents in their budgeting process.
“A lot of this is out of whack, but it’s what we have to do to maintain a level of service for this community,” he said.
The board plans to discuss the budget and any possible cuts at its next budget workshop meeting at 9 a.m. Friday.
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