City commissioners said Tuesday they would like the Riley County Police Department to dip into its reserve funds to address a budget shortfall.
Because revenues from funding sources are lower than expected, the police department is projected to be $237,816 short of its nearly $14.45 million budget in 2014. That figure is based on analysis by city staffers after receiving the second payment for property taxes.
The difference comes from a shortfall of $194,314 in property taxes and $43,502 in delinquent taxes compared with the department’s projections.
“It’s one of those things we have to occasionally work through,” finance director Bernie Hayen said. “We have in the past.”
Commissioner Karen McCulloh said this is a frequent issue with the RCPD.
“This comes up so often, it just seems like it really shouldn’t be something we have to constantly re-discuss,” she said.
McCulloh supported using reserve funds, saying the law board could come to the commission if there were any problems.
The police department’s reserve fund has $700,000.
In the past, RCPD director Brad Schoen has made the argument that the reserve fund isn’t for budget shortfalls but for emergency situations such as natural disasters.
The shortfall could be softened if additional delinquent payments come in for the city, but assistant finance director Hillary Badger said it likely wouldn’t take care of the entire amount.
Badger said the city has budgeted for $180,000 in expected delinquency tax revenue before considering the $237,816 in additional payments it would take to balance the RCPD budget.
“It would put a little over $400,000 in delinquency revenue received in 2015, which we have never received in history,” she said.
The RCPD budget represents about 60 percent of the total city property taxes levied, which means the largest portion of delinquency tax payments also would go to the department, Hayen said.
Mayor Wynn Butler said delinquency tax revenue that goes back to the police department provides additional money, and the Riley County Law Enforcement Agency Board should handle any shortfall.
“It can’t be a burden to the city, and it can’t be a burden to the county,” Butler said.
Among the rejected options were raising the 2015 RCPD mill levy by 0.474 mills to cover the shortfall, using money from the city’s general fund to make up the shortfall, and re-initiating a 2-percent delinquency rate for RCPD in 2015.
A mill is $1 in tax for every $1,000 in assessed, taxable property value.
City manager Ron Fehr said the easiest solution would involve re-initiating a 2-percent delinquency rate on property taxes.
Fehr said officials kept it out of the 2014 budget in order to keep the mill levy low.
“In years where we had budgeted for delinquency, there hasn’t been a problem,” he said. “Essentially, you’re overtaxing people for the people who don’t pay taxes at that time.”
Commissioner Rich Jankovich said he would have a hard time putting that burden on taxpayers.
“If we build in a delinquency factor in the budget, we’re penalizing all the taxpayers that are paying their taxes on time,” he said.
Commissioner Usha Reddi agreed with Jankovich’s rationale.
“(It) seems like the most effective way to tap into their own reserves, instead of penalizing everybody all over again,” she said.