MADEIRA BEACH — The city has an "awful, horrible problem," according to City Manager Shane Crawford. It is unlike the problems facing many other cities and counties.
Quite simply, the city has a lot more money than it needs to pay for city operations.
"Other cities would love to have that problem," Crawford told the City Commission last week.
The city will spend $5.5 million this year to pay for salaries and city services such as administration, law enforcement and fire protection.
Another $2.6 million in the city's sales tax fund is budgeted mostly for capital projects.
Those totals do not include another almost $5 million budgeted for sanitation, stormwater, and the marina, as well as special categories such as John's Pass, parking and vehicle replacements.
Many of those services generally pay for themselves through user fees.
The city also has a reserve fund for both general and capital spending that is not included in the current budget.
In fact, the city has 266 percent of that money actually in the bank or expected to be received from property taxes and other revenues by the end of the city's fiscal year, according to the city's new finance director, Vincent Tenaglia.
That equates to the equivalent of a whopping $14,047,494 savings account.
A little more than half of that amount — just over $7 million — is in the general fund and could be used for anything the commission might want. The rest is money the city receives from the county's Penny for Pinellas sales tax and must be used for capital projects.
City policy is to keep its reserve fund at about 33 percent to have enough money in the event of a hurricane or other emergency.
"This is a lot more than 33 percent. Your cash on hand is very healthy," Crawford said, adding that he will be asking the commission for direction on how to "handle" the extra cash.
The commission is considering rebuilding its aging city hall, fire station and public works building. Within the next few months, Wannemacher Jensen Architects will present concept drawings and initial cost estimates for those buildings.
"We have enough cash to fund some of these building projects and still be very, very healthy with cash reserves," Crawford said.
Crawford and Tenaglia are studying the current budget, as well as collecting needs and wants from various department heads, before drafting the city manager's initial budget proposal.
The city's administrative team plans to present the commission with a budget for the 2012-2013 fiscal year at a meeting June 29.