Murphy City Councilmembers received a general overview of the budget and then heard reports from various department heads for budgets for the next fiscal year – from human resources to municipal court to police and fire department – at May 6 retreat.
At the retreat, councilmembers discussed fiscal year 2022, which begins Oct. 1. For FY21, it has projected general fund revenues – $15,083,148 – that will exceed budget estimates – $15,039,556 – by $43,592. Expenditures, though, will be $43,482 less than what was budgeted: from $15,477,185 to $15,433,703.
“Both of those are what we would call favorable variances,” said Karen Montgomery, city finance director, in a later interview, explaining there is less of deficit by $87,074.
The FY21 general revenue fund budget has a $351,000 shortfall. When the budget was finished last year, city officials thought the shortfall was going to be $438,000, but the shortfall of $351,000 is an improvement of $87,000.
“Historically, we are so conservative and in addition to being conservative, we’ve had very responsible practices,” Montgomery said.
The city has never ended a year with a deficit, but the city also has a sizable fund balance/ reserve, she said.
“Every time the year ends, whatever surplus we have goes into increase our fund balance, the reserve,” Montgomery said. “The opposite would happen if we should have a shortfall. If the shortfall becomes realized, we have a large enough fund balance that can absorb that and still exceed the reserve requirements that the city council has set by policy.”
By Don Munsch • [email protected]