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St. Pete Beach sewer fund borrows $340,000

ST. PETE BEACH — The City Commission closed out its books last week on the 2007-2008 fiscal year, transferring $340,000 to cover red ink in its ailing sewer fund.

The shortfall could have been almost $100,000 worse, but the city was able to cut some expenses over the course of the year.

"The wastewater fund actually exceeded its budgeted expenses by $430,000," said the city's finance director, Elaine Trehy.

To date, the wastewater fund has borrowed $1.2-million from the general fund. Trehy said the city's general fund will be repaid, eventually, with interest.

But that won't happen unless the city raises residential sewer fees, possibly as much as 45 percent, an amount recommended several weeks ago by a consulting firm hired to perform an in-depth study of the aging sewer system.

The commission also met in a workshop session Tuesday to debate the consultant's recommended sewer fee increases as well as other changes to modernize the system.

The city's sewer system was built in 1957 and includes 38.7 miles of gravity lines, 751 manholes, 2.9 miles of force mains, three pump stations, 14 lift stations and a new master pump station.

Because the sewer system's reserves are depleted and until revenues are increased through a sewer fee hike, the city may have to continue loaning money to pay for treating effluent sent to a regional treatment plant owned by St. Petersburg.

Other adjustments to last year's budget approved by the commission included covering about $160,000 to cover increased revenues in the police and fire department pension funds, an $80,000 increase in operational costs in the police department, a $100,000 increase in legal fees, and minor changes to the city's recreation department budget.

During the past year, the city partially offset the increase in legal fees by eliminating the planned fireworks display on the Fourth of July and by a transfer from the city manager's budget that had unspent funds set aside for general liability and workers compensation insurance coverage.

"We do this each year as part of closing out the fiscal year," said City Manager Mike Bonfield.

Trehy also told the commission the city ended up the fiscal year with an extra $100,000 in reserves.

"We were expecting to come out $100,000 to the bad," said Bonfield.

"Congratulations, City Manager, that's great. That's good news," said Mayor Michael Finnerty.

The city added to cuts begun earlier in the year to restrain spending in the coming year and offset an expected 9.8 percent reduction in property tax revenues — a potential shortfall of more than $1-million.

City staff was reduced by 18 employees, spending for a Washington, D.C., lobbyist was cut in half, and capital improvement projects were restricted to only the most needed maintenance items.

"It is going to be a hard budget next year, there's no doubt," said Commissioner Harry Metz. "The money is something we really, really need to keep a tight eye on."

St. Pete Beach sewer fund borrows $340,000 11/18/08 [Last modified: Wednesday, November 19, 2008 8:08pm]
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