The Ann Arbor City Council has approved the budget for the 2014 fiscal year and has released a plan for budgeting in the 2015 fiscal year.

The budget, presented to the council by City Administrator Steve Powers, contains increases to the number of full time employees, expenditures on social welfare programs and other various city improvements and maintenance projects.

With a 2.3 percent increase in property tax revenue and a 4.4 percent increase in General Fund revenues, the city has accrued a $1.4 million budget surplus for the 2014 fiscal year. Some of this extra revenue is due to profits from Ann Arbor’s golf courses.

These surplus funds will be allocated toward making one-time improvements to facilities, bettering financial services and hiring more employees. After several successive years of labor cuts, the city will add eight full-time equivalent jobs — including four positions in Fire Services.

Despite this surplus, there is a projected $1.6 million deficit for the 2015 fiscal year due to an increase in fixed costs.

Council member Jane Lumm (I-Ward 2) said this coming deficit was not something that she thought was in the city’s best interests.

On the other hand, council member Chris Taylor (D-Ward 3) said he had confidence in the city’s financial status and believed that it would be robust in the coming years.

“The city has always presented balanced budgets during the course of the Great Recession and has always been in great fiscal health,” Taylor said. “The ability of the city to provide desirable services has improved as economic conditions have improved.”

Taylor said the need to cut employees has “by and large gone away.”

Similar to Taylor, Powers said the city had a positive fiscal outlook, adding that it was the result of wise decisions that helped to contain city expenses and increase revenues.

However, Powers said it would be best to contain and minimize city spending and keep down recurring expenditures.

“We are still in a position where we need to restrain our spending,” Powers said.

However, for the coming fiscal year, there has been a 15 percent increase costs for the pension system and 4.4 percent increase in recurring annual expenses.

Taylor said despite the challenge to fund the pensions of retiring employees, the city would meet its obligations.

“It will continue to be a substantial (expense) and the city will go forward and meet it,” Taylor said.

Lumm said the city would need to keep this issue in mind in future contract negotiations.

“It is critical that in every contract we negotiate that we raise the issue and start to address our pension offerings going forward,” Lumm said.

Powers added that there would be more information presented to the council members on these long-term obligations in the next quarter in order to make informed future budget decisions.

Along with the budget, several amendments were passed that allocated and reallocated money toward social welfare programs — including $100,000 for the Washtenaw Health Initiatives, $300,000 for affordable housing initiatives, $4,500 for a senior meal program — park funding and city maintenance.

Another proposal to resume the pickup of leaves on streets — a service eliminated during the recession — was proposed and defeated because of high cost of over $300,000 and its difficulty to implement.

Proposals to increase police funding in order to add three full-time employees, through elimination of three probation officers, and a separate proposal to increase police staffing by one full time employee, through eliminating employees in the city attorney’s office, were both defeated by a margin of 6-5 and 9-2, respectively.

Taylor said the city didn’t need more money allocated to safety services, as over 50 percent of the city’s annual budget was already allocated to funding those services.

“We need a balanced approach,” Taylor said. “The benefit of adding additional officers does not away the detriment by the offsetting cuts needed to fund those officers.”

Lumm, who proposed the amendment to allocate three more full-time positions to the police department, said she was disappointed with the outcome. She didn’t think the city was prioritizing public safety as much as it should.

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