Breckenridge outlines budget
BRECKENRIDGE – Breckenridge Financial Director Judy Ferris is reducing revenue estimates in the town’s proposed $30 million budget in anticipation of even lower sales tax and development fees next year.
“We are not anticipating much improvement to the economy in our projections for 2003,” she wrote in a summary to the town council. “The sputtering economy that began in 2001 has continued through 2002 and has resulted in decreased collections of sales tax, accommodations tax and development-related fees.”
For the past month, the town council has examined details in the budget, particularly in light of the soft economy.
According to town records, sales tax revenues rose every year since 1987 until this year, when they fell 4.6 percent. The 2003 budget is based on a 1.8-percent increase in sales taxes over those collected this year.
Two significant events will impact the budget: the contract to buy 1,800 acres of open space in the Golden Horseshoe and the development agreement with Breckenridge Ski Resort based on redevelopment and new construction at Peaks 7 and 8.
The $9 million Golden Horseshoe deal is a joint acquisition with Summit County. Currently, environmental experts are inspecting the land to make sure potential contamination from mines, mills and tailings left from the 1880s and later won’t become a environmental liability.
The agreement between the town and the ski resort outlines how the two will work together to ensure quality development at the bases of Peak 7 and Peak 8, preserve in-town skier parking, eliminate density on in-town properties and build a gondola from town to the Peak 7 and Peak 8 bases.
The 2003 budget also addresses the town’s continued efforts to connect the Sawmill and Watson day-skier parking lots to the downtown core.
None of it can be done without money, and this year, money is tight.
According to Ferris, revised estimates for sales tax revenues are down more than $400,000 this year, and she estimates next year’s will be down $250,000 from what was budgeted in 2002. Additionally, development and building-related fees are expected to be 20 percent less next year.
On a brighter note, Real Estate Transfer Tax (RETT) revenue, a 1-percent fee collected on the sale of property, is expected to be up. This tax primarily funds capital projects and helps pay off bonds on the original 18 holes of the golf course. That, in turn, frees up funds for the operational side of the budget.
The town is going into the new year in the black, primarily due to cost-cutting measures and increases in some fees. To keep the budget balanced, Ferris proposes a status quo on operating expenses and delaying some capital expenditures.
Although the town carries a sizeable debt – mostly for capital improvement projects in the past several years – the budget Ferris proposes will keep at least $7 million in the bank to cover the debt and to serve as a safety reserve if revenue declines even more.
The circle of money
The proposed budget indicates the town should bring in $31.31 million in revenue next year, and spend $30.44 million.
The $30 million in expenditures is $4 million less than what the town spent in 2001, and almost $2 million less than what was originally budgeted to be spent last year.
The bulk of the town’s revenue – 35 percent – comes from sales taxes, which have been on a downward trend all year. Other funds come from water systems fees (9 percent), RETT and recreation fees (both 8 percent), internal service fund fees (6 percent), and property and accommodations taxes (both 5 percent).
Other sources include golf course revenue, franchise taxes, licenses and permits, charges for services, intergovernmental revenue and miscellany.
Almost 17 percent of the town’s revenue is spent in the public works and engineering departments, 13 percent is spent on recreation, 10 percent on the water utility fund and 9.4 percent for law enforcement.
Numerous other funds supply money to pay for debt, parking and transit, affordable housing, the golf course, community development, grants, marketing and open space.
The Proposed 2003 Budget
? Maintains a minimum $7 million fund balance
? No tax increases
? Anticipates less sales tax, accommodations tax and building related revenue
? Delays some capital improvement projects
? Will keep service levels the same and hire no new people for general operations – except for impacts related to the Warrior’s Mark annexation.
? Brings the Gold Run Nordic Center in-house
? Supports affordable housing, marketing, events and grant funding
? Begins work on the Cultural Arts Master Plan and Riverwalk Improvement Plan.
? Continues acquisition of lands through the Open Space Fund.
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