The city is looking at changes in expenses to eliminate its $62,193 deficit in the general fund budget for fiscal year 2022.

The Marshalltown City Council was presented a menu of five potential solutions to tackle the deficit. They are:

• Reduce agreement with the Marshalltown Chamber for tourism and marketing

• Reduce non-bargaining wage increase from 2.5 percent to lesser figure

• Transfer council-designated local option sales tax for deficit

• Use fund balance fiscal year 2021 projected to end with surplus of $400,000

• Reduce line items.

Line items were suggested by city departments when asked for reductions. Some of the larger line item reductions included the library book spending by $5,000, mosquito spray by $4,000 and Summer Blast admissions by $4,000.

Discussion during the virtual council meeting was somewhat limited due to audio issues. Three members attended the meeting virtually. It will be discussed again during a special meeting on Feb. 1.

During the discussion, Councilman Gabe Isom inquired about using the fund balance from fiscal year 2021 which is projected to end with a surplus of $400,000. Councilman Gary Thompson asked about the option to reduce the agreement with the Chamber of Commerce for tourism and marketing. Representatives from the Chamber will be in attendance at the upcoming special meeting to discuss the agreement and explain to the council how tourism and marketing funds are used, according to City Administrator Jessica Kinser.

Kinser said it has been common to face a deficit at some point during the budgeting process.

“What we’re looking at is a little over $62,000 which is certainly nothing to sneeze at. That’s typically an employee” she said. “With the options we have for the council to consider, $62,000 is not easy but it’s doable.”

One reason the general fund is in a deficit is a lower than average increase in property valuations.

“The big thing we saw this year was a 0.48 percent increase in property valuations which is very small compared to prior years,” Kinser said. “On average I would ballpark the average in the 2.5 percent range for the prior four fiscal years. We were not expecting anything this low for the fiscal year.”

The budgeting process begins in November with the finance department meeting with city department heads. Compiling information from each department the budget is presented to the council.

The general fund is especially difficult to work with because it relies on property valuations which are received from the county. This revenue information is often not available until after expenses are figured out, according to Kinser.

“It feels like we’re always working backward,” she said. “Then we figure out if we have a surplus or a deficit.”

If the council would choose to do nothing about the budget, surplus funds from the current year would be applied.

“Any issue we come across in budgeting is not insurmountable,” Kinser said. “It’s just about finding a solution. It’s the same thing pretty much every year making sure we’re working with the council to be fiscally responsible.”

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Contact Joe Fisher at 641-753-6611 or jfisher@timesrepublican.com