Tight but balanced

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Lake Dallas plans budget expenses to match revenue

LAKE DALLAS — The city’s proposed $4.7 million budget for 2013-14 shows Lake Dallas expects to bring in a little less revenue than the previous year, but the city maintains a balanced budget with revenue slightly outpacing expenditures.

Last year, city officials said they began to notice positive changes in the economy as they began to put together their 2012-13 budget, and although the 2013 budget was tight, officials said it was the first time in about four years the city had any breathing room. Lake Dallas was even able to give employees a 3 percent raise, the first in about three years.

Mayor Tony Marino said the budget process was difficult, but he was happy with the outcome.

Interim City Manager Nick Ristagno, in a recent meeting, said he’s even optimistic the city will finish in a better position than officials originally anticipated.

The proposed budget is still tight, but Finance Director Donna Boner said some of the same positive trends that began in 2012 have continued into this year.

“We have shown an increase in our sales tax revenue for the year. Everything else is basically the same,” she said.

According to the proposed 2013-14 budget, property taxes have also increased slightly, by about $14,700, from new properties added to the tax roll this year.

Budgets for each department are expected to be nearly identical to those of the current fiscal year, with only a few changes.

In recent years, the city has had financial troubles, but Lake Dallas appears to be slowly recovering based on the slight revenue increases from the last two years.

According to the city’s most recent financial audit conducted by Hankins, Eastup, Deaton, Tonn & Seay, the financial troubles the city has suffered in recent years were the result of several contributing factors.

While the economic downturn was partly to blame, the spending of unbudgeted funds on a variety of projects and on consulting fees were major contributors to growing city debt and deficit spending, according to the audit.

Because of the growing debts, Lake Dallas was forced to borrow more money to maintain daily operations “to continue business as usual,” according to the audit.

The city has one of the highest property tax rates in Denton County and in North Texas, and that made it difficult for Lake Dallas to tax its way out of financial difficulty, according to Boner and the audit report.

During discussions about the 2012-13 budget, Boner and council members said it would take a significant property tax increase — about 5 or 6 cents per $100 valuation — for the city to recover quickly, an idea they soon dismissed.

City officials said they must rely on new construction and sales tax revenue instead.

In 2008, Lake Dallas borrowed $500,000 to keep the city running. The loan was scheduled to be paid in full in the 2012 fiscal year, but the city lacked the means to do so. The loan was then renegotiated and will be paid incrementally through the 2015 fiscal year, the auditors reported.

Since the audit, financial officials have encouraged the city to avoid incurring any more debts.

The new fiscal year begins Oct. 1 and the city must adopt the budget before then. A public hearing on the budget is scheduled for 7:30 p.m. Thursday at Lake Dallas City Hall, 212 Main St.

City officials say they encourage residents to attend the hearing and make comments.

JOHN D. HARDEN can be reached at 940-566-6882 and via Twitter at @JDHarden.


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