ROGERS -- The City Council on Tuesday will consider adopting a $78.2 million budget for next year.
The council heard presentations from department leaders and discussed 2023 budget proposals during a session at City Hall on Monday .
The entire proposed budget includes about $78.9 million in revenue, $78.2 million in expenses and capital projects and a surplus of $713,900. The proposed 2023 budget represents a 10% increase from the $71 million budget that was approved for 2022.
As the cost of goods has risen this year, so have both revenue and operational costs for the city, Finance Director Casey Wilhelm said.
Sales tax is a major part of the revenue supporting city operations, according to Wilhelm. The proposed budget projects a $4.7 million increase in sales tax revenues for 2023, a 12.5% jump from last year, she said.
The city is on track for an estimated 13% increase in sales tax revenue for 2022, compared with 15.6% in 2021 and 1.5% in 2020, she said.
Sunday alcohol sales in the city, approved by voters earlier this month, will contribute to sales tax revenue as well, she said.
The city estimates revenues conservatively and does not consider reserve funds to balance the budget, Wilhelm said. That allows the city's reserve fund to grow, she said.
Employees would receive a 5% cost of living adjustment and would be eligible for a merit raise of up to 2%, Wilhelm said. The city made an additional 75 cents per hour adjustment for employees in June.
The general fund budget is about $61.7 million with a projected surplus of $309,432. Most city departments are included in the general fund, though street and airport funds are separate.
About 72% of the general fund goes to paying employees.
An estimated $41.5 million in city and county sales tax revenue is included in the general fund budget.
The Police, Fire and Parks departments account for over half of the budget's general fund expenses -- including personnel costs -- and capital projects, a combined $35.7 million -- approximately $15.2 million, $13.7 million and $6.7 million, respectively.
Police Department requests include $752,410 for vehicle purchases and $200,000 for small tools and equipment like tasers and an Apex officer virtual reality training simulator. Fire Department requests include $275,000 for an ambulance.
PUBLIC SAFETY PERSONNEL
Hiring and keeping employees has continued to be an issue throughout the year for the Police Department, council members heard at Monday's meeting. Council members who spoke expressed support for making the department more competitive in recruiting and retention.
A short-term solution to be announced later this year is not a part of the proposed 2023 budget because it will use existing appropriated funds, according to Mayor Greg Hines. That will allow city staff to spend next year working on a long-term strategy, he said.
Northwest Arkansas is experiencing low unemployment rates around 2.5%, about the same as this time last year, according to the U.S. Bureau of Labor Statistics.
"The pressure of the local market on all positions in all departments is as difficult as I have experienced in my career," said Thomas Dunlap, director of human resources and development. The pressure started before the covid-19 pandemic, according to Dunlap.
The Police Department is requesting $84,967 to fund one new position in the proposed budget: a support services division sergeant who would maintain equipment and review video associated with the cameras worn by police and placed in vehicles, police Chief Jonathan Best said.
The department had 18 open positions as of Nov. 9, according to Best. This year, about 15 people have been hired by the department and 19 have left, he said.
"We're hiring almost as fast as they're leaving," he said.
The reasons for leaving have varied. Ten left for other local agencies like Benton County, Bentonville, Prairie Grove and Russellville, Best said.
Eleven officers left during the first half of 2021 to work for Walmart's global investigations unit, he said. Two more have gone to Walmart so far this year, he said.
Departments nationwide are dealing with the same problem, Hines said.
On Nov. 8, Springdale approved a pay scale adjustment for its Police Department, authorizing 6% raises for the department, including a $50,000 salary for beginning patrolmen.
The starting salary in the Rogers department is $44,882 before any adjustments for bilingual ability, degrees or previous experience, according to Dunlap.
Rogers staff completed the proposed 2023 budget before Springdale announced it was considering the raises, Dunlap said.
Despite a lower starting rate, Rogers police may be better compensated as a whole because of the city's health and retirement benefits; however, many recruits consider salary more important than retirement benefits, Dunlap said.
The city approved a $5,000 stipend for police officers this summer. The one-time stipends, totaling $667,430, were funded by Senate Bill 103, known as the Arkansas Full-Time Law Enforcement Officer Salary Stipend Act of 2022.
So far, more department personnel have left on average each month since the stipend than before, Best said. Some left and were able to keep the stipend because they still worked for a law enforcement agency, he said.
When asked if the department needed to increase the $16,000 for recruiting in the proposed budget, Best said the department planned to meet with a marketing company soon and may revisit the number.
Ultimately, a decision by voters to turn down an expansion of the Benton County Jail will have a bigger impact on retention than anything the city can do with its money, Hines said. Making an arrest when there is no room in the jail can be demoralizing for law enforcement, he said.
"I think that's going to be our biggest challenge moving forward," he said.
The Fire Department does not currently have any open positions, though it has seen a significant number of new firefighters and more turnover than usual lately, according to fire Chief Tom Jenkins. More money is requested for department recruiting efforts in the 2023 budget.
The department and risk reduction division are requesting $162,442 to add a combined four new positions -- three full-time and one part-time -- next year.
The only other department to request funds for new positions was the Parks Department, which proposed adding three at a total cost of $123,970.
OTHER SPENDING
The city's current two-bus on-demand system through Ozark Regional Transit would expand to a three-bus hybrid system under the proposed budget.
Public transit receives $522,000 in the budget, an increase from $465,016 last year, alongside a $332,000 Walton Family Foundation grant, Community Development Director John McCurdy said.
The hybrid system will offer fixed route service in the morning and afternoons, when many riders are using the buses to commute, and on-demand service in between, when many riders are running errands on a less regimented schedule, he said.
The change will provide more frequency and reliability to the city's transit system and increase capacity by 50%, he said.
"I've used the bus quite a bit to get to work and to get home, and it's just unreliable," McCurdy said. "I think this is a logical next step in the evolution of transit in Rogers."
Arts and culture programming would be funded with $270,000 in the proposed budget, according to McCurdy.
Railyard Live concerts and related downtown events drew an average of 700 people per event and saw revenue from ticket sales from table reservations almost double, he said.
The Walton Family Foundation will contribute a $270,000 grant for programming and a $715,000 grant for renovations to the Victory Theater, home of Arkansas Public Theatre. The renovations will more than double the downtown building's capacity, he said.
The Rogers Historical Museum anticipates spending $250,000 on an outdoor green space project to improve its campus, museum Director Serena Barnett said.
City administrators have also proposed using $280,000 on roof work for city buildings, $170,000 on indoor renovations of City Hall, $180,000 for a bucket truck for the Parks Department and $120,000 for trail maintenance.