The COVID-19 pandemic continues to impact Marshalltown’s city budget. 

While the budget items this fiscal year won’t be hit as hard, starting in July the city could be forced to increase the amounts it bonds to pay for necessary projects around Marshalltown. 

“This is a new era,” said Diana Steiner, finance director. “It’s hard to make predictions of what’s going to happen, but for fiscal year 21 revenues will come in on target now that businesses are starting to open again. However we know that hotel motel tax will be hit hard.”

The city had budgeted $495,000 worth of hotel motel tax revenue, but now only $262,640 is expected from the tax revenues.

The COVID-19 pandemic has caused a reduction in the city revenues, specifically hotel/motel tax, local option sales tax, and road use tax. The projected first quarterly payment should be similar to prior years, since it was for the hotel stays January-March.

This year’s second quarter is expected to be 36 percent of an average fiscal year and 50 percent for the third and fourth quarters of the year. 

In an effort to balance the budget, job positions that are now known to become vacant during fiscal year 2021 due to retirements were re-evaluated and reclassified to a lower pay grade. Reclassifying retired positions is predicted to save the city $127,835, which will cover the shortfall from hotel motel tax of $124,249.

The retired position that will have their pay downgraded include the city clerk, park superintendent, police officer and lieutenant.

“This is just a stab in the dark,” Steiner said. ‘We’re not recommending any other adjustments at this time, but we’ll look for savings throughout this year.” 

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Contact Thomas Nelson at tnelson@timesrepublican.com