Bucking a recent onslaught of grim finance news, Tacoma city officials announced Tuesday its past two-year budget fared $4.5 million better than expected, and its current spending plan so far is $3.7 million ahead of target.
“While favorable variances exist, as the budget officer, cautious optimism is required,” Tad Wille told the City Council Tuesday.
Despite the good news, Wille noted, the city still faces “difficult challenges” ahead – namely, a projected $30 million to $40 million shortfall in its forthcoming 2015-16 General Fund.
Wille’s comments came during presentations to the council providing details of an end-of-biennium report for the 2011-12 general fund, and a first quarter update on the 2013-14 budget.
The last city budget, which required $32 million of cuts, closed out about $4.5 million better than expected, Wille said.
A legal settlement, a levy refund and several other unanticipated one-time-funds that came in before the end of 2012 largely drove that positive uptick, he added.
Finance officials plan to re-appropriate about $1.1 million of the unexpected revenue from the last budget toward several purchases and services already committed to in the current one – including gang prevention programs and library materials. The remaining $3.4 million will go into the city’s budget reserves, Wille added.
Meantime, the current budget cycle’s $3.7 million-better-than-projected pace comes from $2 million less in expected spending and $1.7 million more in various revenues three months into the new biennium, Wille said.
But City Manager T.C. Broadnax and new city Finance Director Andy Cherullo each said at least nine months of data is needed to provide an accurate signal of how the budget is faring.
“Three months doesn’t really make a trend,” added Cherullo, who noted the economy’s recent volatility. “…Let’s see it in the books before we start thinking it actually exists.”
Adopted with more than $60 million of across-the-board cuts in jobs and services, the $396 million general fund for 2013-14 marked what Broadnax called his “back to basics” approach at righting the city’s budget woes. Tuesday’s presentations were part of a new initiative to provide easier-to-understand and more frequent budget reports to the public.