SIDNEY — The 2022-2026 financial plan was introduced by Renee DuLaney, assistant finance officer, with City Manager Mark Cundiff, during Sidney City Council’s workshop session, Tuesday night.
The five-year plan encompasses Sidney’s Comprehensive Plan, council’s goals, the long-term financial plan and capital planning to determine the annual budget.
The plan shows a quick recovery after the 10.8% decline of income taxes in 2020 from 2019. It also projects a moderate increase for the income tax, a moderate increase in existing fees, some staff additions and capital improvement projects.
DuLaney’s report showed a 9.1% increase in 2021 revenue from 2020. The 2021 income tax economic growth is expected to recover 1% greater than the 2019 collections, and indicates an average annual growth of 3% for years 2022-2026. This supports the general fund.
This revenue does not include COVID-19 revenue sources, such as the one-time CARES Act funds distribution of $2.1 million, which ends on Dec. 31, 2021; or American Rescue Plan Act (ARPA) funds, from the Local Fiscal Recovery Fund (based on current allocation). Nearly $1.8 million of CARES dollars in Sidney went towards police and fire salaries. The city’s share of the initial calculation of two distributions (one in July 2021 and one in July 2022) is about $2.1 million. An additional distribution may be allocated to Sidney in fourth quarter of 2021.
Over the five year planning period, the plan includes the addition of three FTE (full-time equivalent) staff member positions to be filled. These positions include a new Sidney firefighter/EMT; a Sidney Police officer; and an IT analyst, pending Shelby County approval and cost sharing.
There are several staffing positions that will temporarily remain vacant, due to the economic impact caused by the COVID-19 pandemic. These positions include an assistant city manager, one firefighter and one police officer.
DuLaney said the city’s staffing level will remain 8% lower in 2026 than it was in 2008. This decrease includes 4.24 less FTEs due to the Sidney Water Park staff now being outsourced for its operations. Following the Great Recession the city cut 37 employees due to the 2008 economic downturn.
In terms of expenditures, her report showed a modest 3% increase in “contractuals, materials and others;” 2.25-2.5% wage scale increases; and a 6% cap on health insurance premium increases.
During the plan overview, DuLaney said the city of Sidney’s revenue from direct collections has increased by 91% after being down in 2020 by 47% compared to 2019. This revenue is from businesses’ profits, which is generated from municipal income tax collections by withholding taxes from people working within the city. Direct collections is a volatile source and is prone to the up and down fluctuations over many years. She noted the reason it was down, is because corporate net profits were down.
Direct collections show a projected increase of 1.8% in 2021, she said, rebounding slightly higher than 2019 collections; and modest annual increases for years 2022-2026. Income tax is has an average 3% annual increase projected over the remaining planning period of 2022-2026, which is projected to be $16.1 million.
