TUPELO — Officials are in the throes of budgeting season with a balanced budget that accounts for increased property values and slightly lower sales tax estimates.
Tupelo officials mulled the budget for the upcoming 2024-25 fiscal year, which they estimate will have a requested expense and revenue generation of about $50.9 million, up from last year’s $43.3 million. Officials also noted $4.7 million in tax revenue that will roll over into the next fiscal year.
“Everybody certainly had their wants and wishes,” Tupelo Mayor Todd Jordan said. “We are balanced as of this point.”
The city got about 2% less in sales tax than had been projected for last year, a deficit of more than $4 million in its collections. The city received $21.4 million, which is less than 2022-23’s actual fiscal year collections of $25.8 million.
Though sales tax collections dropped, officials said ad valorem tax collection increases made up the shortfall with property values increasing and a host of new construction and industry bringing in more revenue. Financial Officer Kim Hanna said the city saw a 12.8% growth in assessed value. The city stayed the course, projecting $25.8 million in the upcoming 2024-25 fiscal year.
“To have this type of increase means people are investing here,” Hanna said.
Almost all city departments saw a rise to salaries in their individual budget. Hanna said this is to make up for the cost-of-living adjustment raise the council approved in January that ran through September of this year. She also noted this budget accounts for the raise for the rest of this calendar year plus the salaries throughout the upcoming fiscal year.
TPD and TFD both see increases
The Tupelo Police Department asked for a raise to its budget to accommodate vehicle maintenance supplies, training and inmate costs, among other smaller things. Its total budget is $13.6 million.
Police Chief John Quaka said the department needed an increase of $20,000 for vehicle maintenance, a total of $120,000, a $50,000 increase in training for $242,502 and a $200,000 increase for inmate care for $600,000.
The increase in inmate costs comes as the Lee County Sheriff’s Office, through Lee County Board of Supervisors approval, raised its rates from $25 a day per inmate to $40. Quaka said this was in line with the area, noting the office was well under the average cost in the region before that change. On top of this, the department is arresting more individuals, Quaka added.
“(TPD) has become more proactive,” Quaka said. “That number (of arrests) is going to continue to grow as our city grows.”
The Fire Department, meanwhile, asked for a 0.7% increase with its budget at a little over $8 million. A majority of the increase, Fire Chief Brad Robinson said, will go toward vehicle maintenance, fire prevention and uniforms.
Departments heads make their pitches, explain increases
Before digging into his department’s budget, Public Works Director Chuck Williams noted he planned to retire on Dec. 27 and said the requested budget reflected that information.
The budget, he said, has a $7,500 increase, cutting part time salary and overtime that the department general does not use and adding to the vehicle maintenance and building maintenance.
The Development Services Department saw a 3.5% raise to its overall budget, with an increase in supplies, travel and dues. Development Services Director Tanner Newman said the increase in travel and dues comes with the increase in code enforcement and their annual training and fees associated with certifications.
Tupelo Parks and Recreations Director Alex Farned noted the department shaved from its athletic supplies, travel and other areas to make up for increases to janitorial supplies, maintenance and other supplies. He noted cuts to those areas last fiscal year led to the department quickly going over budget.
The Aquatic Center also raised its supplies and maintenance expenses.
Tupelo Convention and Visitors Bureau reported a slight increase in its budget specifically for supplies and insurance. CVB generates its revenue through a 2% sales tax for restaurants and hotels, which totalled close to 6.5 million.
The largest increases were to advertising and promotions. CVB Executive Director Stephanie Coomer said next year would have been Elvis’ 90th birthday and B.B. King’s 100th birthday as well as multiple anniversaries for local landmarks, such as the 80th anniversary of Johnnie’s Drive-In and 70th for Dairy Kream among others. She said the bureau is looking to hold events throughout the year to celebrate these anniversaries.
CVB also received funding through the American Rescue Plan Act for advertising, so, Coomer said, the money that usually goes to advertising will instead go into destination development. The bureau’s in-market strategies budget also went up 200% from $10,000 to $30,000 to accommodate increased output for programs in the city.
The CVB board voted to approve the budget in August and awaits final approval alongside the city budget.
The city’s debt services rose by 49% with the increase stemming from the last payment to the Mississippi Development Authority for the purchase of the Old National Guard building.
Community Services funding still flexible
Hanna presented the community service budget, which includes money for local organization partners of the city. It stayed nearly the same at a total of $1.2 million in expenses. Most organizations stayed at the same funding request save for an increase to E-911, Downtown Tupelo Main Street Association and Council of Government fees.
Meanwhile, the Link Centre requested $30,000 for a matching grant for renovations. Hanna and Lewis both said it was up to the administration and council to add that to the budget officially, with it not in the current budget draft.
Ward 4 Councilwoman and Council President Nettie Davis gave her support to giving the nonprofit the requested funding, but the rest of the council were more hesitant.
“I’m just concerned. The Link Centre does a lot for this community,” she said. “I would like to see us come up with some amount.”
Lewis said it was up to the board, noting that the city had until Sept. 14 to figure out where the city would cut to find the needed $30,000.
The Lee-Itawamba Library System also asked for increased funding to help give raises to its employees and build up its supplies. The Lee-Itawamba Library System got $538,000 last year and Phillip Shackelford requested $691,700, a 28.5% increase. He said it was important to reward his employees who have not seen a raise in some time. The current proposed city budget does not grant that $153,700 increase, instead supplying a $44,000 increase.
Chief Operation Officer Don Lewis said the city expects to dive into its capital plan next week during work sessions to let the council solely focus on the budget itself.
TW&L sees light decrease in budgets, rates to rise with TVA prices
Tupelo Water & Light is required to split its budget off from the whole of the city’s budget, and to further dissect it by electric and water funds. Both budgets saw a decrease, according to TW&L Director Johnny Timmons.
These decreases come from the fact that last year, the budget was raised to accommodate multiple projects. Now the city has paid for the brunt of the projects which were purchased through ARPA funds and State Revolving Loan funds. The budget decreased in response.
The electric department budget went from close to $70 million to about $68 million, a $2.1 million decrease. The water and sewer department fell from $28.4 million to $27.6 million, a $813,881 decrease.
Meanwhile, Timmons noted Tennessee Valley Authority raised its wholesale electricity prices by 3.2%, so TW&L customers will see an increase in the next fiscal year. The city’s customer rates increased in 2022, from a base bill of $11.88 to $13.34 (a 5.8% increase). Last year, the city raised commercial rates by $1.60 per $100 to accommodate a 1.6% increase in TVA rates.
As of Friday, Timmons said the department plans to raise rates by 2% to accommodate the TVA increase. He noted the council will likely vote on the measure at the next meeting, which is scheduled for Tuesday. He also said TVA has over $15 million worth of projects in the works over the next five years and expects their rates to continue rising to accomplish that.