Unified Government budget revisions due to COVID-19 will be on the agenda for Monday evening’s UG Economic Development and Finance Committee meeting.
The meeting will begin after the end of the UG’s 5 p.m. NCD committee meeting. It will be a remote Zoom meeting.
At a budget update held on April 30, the UG Commission heard about the potential revenue impact on the UG from the COVID-19 pandemic.
UG Administrator Doug Bach said the UG has costs of more than $1 million, and revenues continued to go down.
Kathleen von Achen, UG chief financial officer, on Thursday gave “best case” and “worst case” estimates for UG revenues.
An estimate for two months of shelter in place in 2020 was $11 million in the UG general fund, $14 million in other funds and a total of $25 million
An estimate for three months of shelter in place, plus a fall wave in 2020, was $22 million in the general fund, $13 million in other funds and $35 million total.
For 2021, a “best case” estimate was that normal activity resumed gradually, with modest growth, for a $4 million impact to the general fund and $6 million impact to other funds and a $10 million total impact, she said.
The “worst case” impact for 2021, with no vaccine found until early June, and depressed retail activity, was a $10 million effect on the general fund, a $12 million effect on other funds and a $22 million total effect, she said.
“The revenue impact we have estimated is significant,” von Achen said. All the actions the UG and the state is taking is aimed at saving lives and that’s the most important thing, she added.
The $25 million to $35 million estimated loss in 2020, about 8.5 percent of the total UG budget, she said.
The anticipated loss in 2021 is from $10 million to $22 million, she added.
She said they’re hoping for the “best case,” but they need to prepare for the worst case.
Sales tax revenues will be deeply affected, she said, but they won’t have actual data until the end of June, because sales tax revenues aren’t received until a couple of months later. Their estimates were based on the prior year’s data, she added.
Sales tax revenue at The Legends is estimated to be down 37 percent, she said. Use tax revenues may increase because of greater online sales and deliveries, she added.
The UG has estimated less impact on property tax, while there may be anticipated delays in collections due to the unemployment rate, she said. The second half of property taxes is due on May 10. Property market values may be affected in 2021 and 2022, she said.
She also estimated less consumption of water and electricity, resulting in lower fees in the commercial class. The gas tax revenues also are expected to be half, as gas prices dropped 40 percent in March, and there has been a reduction in travel, she said.
Hotel occupancies were estimated to have dropped 60 percent here, she added, affecting the transient guest tax.
Von Achen said at the Thursday meeting that the UG has been reviewing the long-term financial plan of the UG, is identifying programs for business process reengineering through priority-based budgeting, is identifying grants and funding opportunities, is conducting cash flow analysis and is implementing near-term cash saving measures.
The UG has suspended the hiring of non-public safety positions, reduced operating expenses to 2019 spending levels in nonpersonnel and noncapital areas, reviewed cash capital funded improvement projects and equipment, and will use its emergency reserves.
The depth of the revenue losses is more than the UG can recover in one year, she said.
The two-month reserve policy was for an emergency such as this, she said. At the end of 2019, the UG’s reserves were at 20 percent of total expenditures, she added. That was almost 8.5 percent of total general fund revenues, she said.
The UG can’t totally rely on dipping into its reserves, so it will also rely on a process to review the organization to see how it can provide services more efficiently, she said. They want to diminish the impact to employees, she added.
Bach said at the Thursday meeting that the UG is trying not to reduce service delivery in certain areas, but may have to cut back in some service delivery areas.
After a question from Commissioner Harold Johnson, Bach said the assumption in the planning will be that the mill levy stays the same for 2021.
Mike Taylor, UG lobbyist, said on Thursday that there was some hope that there may be direct federal funds allotted for local governments and states. There was support for $1 trillion for states and cities from the House speaker, while not as much support from some in the Senate. He believed they would probably end up somewhere in the middle.
The state of Kansas is looking at a $1.2 billion revenue shortfall, and has received $736 million in federal funding, he said.
The UG EDF Committee, meeting Monday evening, also will consider:
Besides the fourth quarter budget revisions, on Monday evening the UG committee will look at the first quarter 2020 cash and investment report and the fourth quarter 2019 budget to actuals report.
Also on the EDF agenda Monday is an ordinance to remove Project Area B from the Mission Cliffs TIF redevelopment project. According to the agenda, it will allow for future development of the area.
Interested persons may watch the meeting on UGTV on Spectrum cable channel 2 and Google TV channel 41, also on YouTube, and may access the meeting through Zoom at https://zoom.us/j/98671994975?pwd=NHdmelBWemI5aFJBWmFxQUI0ZnFGQT09 Password: 682954.
Persons also may listen to the meeting through telephone lines, and the phone numbers are on the EDF committee agenda at https://wycokck.civicclerk.com/web/UserControls/DocPreview.aspx?p=1&aoid=1702.
Meeting at 5 p.m. Monday is the UG Neighborhood and Community Development committee.
The NCD committee will consider a Land Bank application for 509 N. 5th St. and has an update on the Land Bank rehab program on the agenda.
The NCD committee meeting will be on the UGTV Spectrum channel 2 on cable TV, on Google TV channel 141, and on YouTube, and also will be on Zoom at https://zoom.us/j/98671994975?pwd=NHdmelBWemI5aFJBWmFxQUI0ZnFGQT09
Also, interested persons may phone in to the NCD meeting, with instructions found on the agenda at https://wycokck.civicclerk.com/web/UserControls/DocPreview.aspx?p=1&aoid=1701.
To see the Thursday, April 30, UG Commission discussion, visit https://www.youtube.com/watch?v=3bucOg3IQWU.