The Neosho City Council gave their first nod of approval to a $16.3 million budget for fiscal year 2014 in their Tuesday evening council meeting.

The Neosho City Council gave their first nod of approval to a $16.3 million budget for fiscal year 2014 in their Tuesday evening council meeting.

Council approved the budget under first reading by a 3-2 vote, with Councilman David Ruth and Mayor Pro Tem Steve Hart voting against the proposed budget.

The budget shows $15.3 million in total revenues.

The budget calls for $10.6 million in expenditures from the general government funds, which includes police, fire, streets, parks, and city administration, among other departments.

The general government funds are expected to take in $9.8 million in revenue, with $3.4 million in other sources and $3.5 million in other uses.

The budget also includes $4.9 million in expenditures for the water/wastewater fund, which is separate from the general government fund.

The water/wastewater account is expected to take in $4.5 million in revenues, with $382,285 coming from other sources, and $302,790 for other uses, while the employee insurance fund has $806,000 in expenditures, with $853,652 in expected contributions.

"The city's overall financial position continued to improve over the last year and is projected to continue to improve over the next fiscal year," City Manager Troy Royer wrote in his budget statement. "We will far exceed a 90-day reserve in the city's general fund."

Spending from that reserve fund was part of the reason Hart said he chose to vote against the budget.

He said the city's property tax rate, which was reduced by 5 percent in a special session meeting last week, was also a factor in his vote, as he believes it should have been more significantly reduced.

Hart proposed in the Aug. 27 meeting that the tax rate be reduced by one-third.

"It's not a balanced budget and second of all, is because of the property tax that I believe needs to be lowered," Hart said after Tuesday evening's meeting. "I believe those two things need to be addressed and we need to start living within our means and our budget doesn't reflect a balanced budget or any major reduction in the property tax that I believe the city's citizens deserve."

Ruth, who also voted against the budget, said in remarks after the Aug. 27 meeting that the property tax would also cause him to vote against the proposed budget.

Ruth, who served on the council in the 1990s, said it was a decision in 1997 that is the reason he cannot vote for a city budget that includes funding from the property tax.

In 1997, Neosho voters were asked to approve a 3/8 cent tax for parks and drainage, and were told in return that the property tax would be rolled back, Ruth said.

That tax was set at zero from 1997 until 2010, after overspending from a previous city administration resulted in a financial crisis for the city and the council voted 4-1 to bring the tax back.

The 2014 budget estimates $400,000 in revenue from the city's property tax in the coming year.

Council also held a public hearing for the proposed budget Tuesday evening, prior to their budget vote, at which time the public was invited to speak on the proposal.

Neosho resident Bob Foster was the only member of the public to speak, and he too voiced his opposition to the property tax, which council approved last week.

"I'm here to ask you to eliminate the city real estate tax," Foster said, noting that he believes the 5 percent reduction was not enough. "If you think that's pacifying us, it's just infuriating us taxpayers."

Councilmen Charles Collinsworth, Tom Workman, and Mayor Richard Davidson voted in favor of the budget proposal.

Davidson said he is pleased with the city's 2014 budget.

"The budget does exactly what I expected it would do in 2014, given the discussions that have been going on since 2010," Davidson said after Tuesday's meeting. "We knew we were going to have a little tight stretch here. We purposely built reserves over the past four years to accommodate the deficit spending in this coming budget."
He said the city's planning put them in a position where the budget calls for no personnel cuts and which allows the city to continue with capital improvements, though he noted that the city manager and city staff will have to continue to watch the budget carefully.

"We are moving forward and have made a tremendous amount of headway," Davidson said. "The next couple of years will be critical and after that the light we're seeing at the end of the tunnel will be ahead of us."

The council will take a final vote on the budget in their Sept. 17 council meeting.

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Read more about Tuesday's council meeting in Thursday's edition of the Neosho Daily News.