Lone Tree City Council unanimously passed a resolution further adjusting the 2020 budget to align with the impacts of the COVID-19 pandemic. “I'm hopeful for the future,” said Mayor Jackie …
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Lone Tree City Council unanimously passed a resolution further adjusting the 2020 budget to align with the impacts of the COVID-19 pandemic.
“I'm hopeful for the future,” said Mayor Jackie Millet, “but we have to take these steps today.”
The newest resolution cuts the city's budget by just under $1 million, bringing the city's total “net COVID impact” to $8 million in cuts. The newest amendment is a net of roughly $10 million in projected revenue shortfalls, thanks to less sales tax revenue, and $9 million in expense cuts in things like canceling or postponing certain public works projects, according to the Sept. 15 staff report.
City staff recommended the use of the city's “working reserve” to cover this deficit, according to the staff report. The working reserve is specifically in place to cover unanticipated revenue shortfalls as a result of economic downturns, the staff report says.
The new total appropriations for 2020 are being decreased by $6.2 million in the general fund, $1.3 million in the Cultural and Community Services Special Revenue Fund and $453,249 in the Arts and Cultural Facilities Debt Service Fund. These are aggragated cuts made since stay-at-home orders began in March.
Finance director Ulli Nierling presented before council in the Sept. 15 virtual council meeting, stating that the city's intent is to provide a more realistic look at the impact COVID-19 continues to have on the city's budget.
"The impacts on our budget, it's really due to a few changes in behavior … as well as consumer spending shifting toward online shopping,” Nierling said. “In Colorado, losses were truly concentrated on communities reliant on outside spending, which is the case for Lone Tree.”
Lone Tree suffered a greater financial impact than its neighboring communities, Nierling said. The city's reliance on sales tax revenue and zero additional property tax created the perfect storm, causing significant setbacks in projects as well as furloughing city staff.
“Unfortunately, we've spent more time on the budget this year than the two years prior, and we're not finished yet,” Millet said. “We're just starting the process for 2021.”
Millet thanked city staff and council for their time spent adjusting the budget, as well as the finance department's emergency preparedness throughout the pandemic.
“A huge, tremendous thank you to the city staff for shepherding us through this challenging year,” Millet said. “No one could have forecasted this … but I'm pleased we did have working reserves and a debt service fund. We had planned for something — we didn't know what — I sure hope it doesn't happen again, but we were very responsible with our planning."
The new budget amendment includes a placeholder for unbudgeted expenses related to COVID-19, which will be paid for through CARES Act funding, according to the staff report. Those expenses include personal protective equipment, technology needs and reallocation of staff resources.
Every part of Lone Tree's budget felt the pinch from the latest cuts. The most significant decreases, according to the staff report, came in sales tax revenue, lodging tax and the Douglas County Shareback for Transportation, which is based on sales tax collections, the staff report says. Expense cuts include cancellations of capital projcets, reductions in operating costs, hiring freezes and furloughs and cancellation of city events.
For more details about the city's amended budget, visit cityoflonetree.com.
“Nobody runs for office with ever having the intention of having to tell someone to take a reduction or cut ... but we appreciate our staff in the City of Lone Tree, and this in no way reflects how much we rely on you, how hard you work and how much you mean to not just us but the residents and businesses you serve,” Millet said. “We look forward to a renewed consumer confidence in Lone Tree's retail and restaurants as we've started to see them come back.”
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