By NICK GOSNELL
Hutch Post
HUTCHINSON, Kan. — Hutchinson City Manager Jeff Cantrell said it became clear to the City Council at their budget meeting Thursday night that cuts need to be made in the 2022 budget to continue holding the two months of expenses ending balance that the City has tried to keep in recent years.
"By the time we left the meeting, everyone had realized that," Cantrell said. "That's the expectation. They sent staff back to return in two weeks with a budget that better frames under that scenario."
The two months ending balance goal would be an ending balance of around $5 million, give or take, because in most years, cities authorize more budget authority than they actually spend.
"What we delivered to them the first time was sort of a wish list, as far as streets," Cantrell said. "That's going to be a big piece of it. We're going to trim that a little bit, but not to worry, because that's probably going to take it back to previous year levels."
Cantrell said costs have grown faster than revenues, which is the reason for the intended cuts.
"Our health premiums, we're seeing, in some cases, double digit increases, after a period of time where we didn't see that, it was pretty stable," Cantrell said. "Dental utilization was at an all-time low, no surprise, because most of the dental offices were closed. There's a little bit of instability in those numbers right now, but certainly those are going to come in much higher."
The new revenue neutral rate statute reporting requirements would require even deeper cuts than what are already being contemplated.
"If we modeled it flat, we're looking at about 44 mills to continue on just like we would have last year," Cantrell said. "To avoid that notification requirement, we'd have to fall into that 43 mill range, potentially even 42 and a half, just to make sure that we have that buffer. The problem with that is that we forgo about a quarter-million bucks if we do that. In the face of increasing costs elsewhere, that's a problem for us that we would have to balance and figure out and it would come in the form of either operational cuts or curtailment of certain fleet type operations."
It's important to note that fleet operations were already delayed as an emergency measure when it wasn't clear what would happen due to the pandemic, so putting those off even farther could cause more cost than it saves in the long run.