The Forsyth City Council has called a meeting for 6 p.m. Tuesday to discuss its financial troubles.
Mayor John Howard II and City Council members will examine a $300,000 budget shortfall that came after a judge ruled against the city during its negotiations with Monroe County about dividing local option sales tax money, said Thomas White, the citys administrator.
Were going to have to adjust our budget, but Im not sure what the steps are, White said.
The citys 2013 budget runs through Dec. 31.
Howard said hes at something of an impasse with the council because he thinks the citys utility rates are too low, having not had any rate increases in the past several years.
Honestly, I dont really know whats on City Councils mind, he said. There are some tough decisions the council knows it needs to make. None one wants to make them or even talk about them. ... If we had made those decisions (years earlier), we wouldnt be in this financial dismay.
Howard said he knows any rate increase is going to be unpopular among residents, but the city has few options other than raising property taxes. He said theres virtually no fat to trim from the current budget.
What else are we going to cut? he said. Were operating now at a bare minimum.
Howard said he has heard from residents that government is not a business, but he said it needs to operate like one.
Were not trying to get rich off the people, but we still have to make rate adjustments, he said. Its something that hasnt been done in several years, and weve had to eat a lot of rate increases. We have a lot of distribution (of utilities), but little or no revenues.
City Clerk Janice Hall told city leaders last week there wasnt enough money in Forsyths daily operating budget to cover expenses that had come due. However, she said, the city was able to use money from other accounts to pay the bills.
White said a judge ruled against the city in its negotiations with the county over the sales tax revenue, and there is no appeals process. Negotiations began in August, and city officials were informed of the ruling April 15.
The LOST revenue split is renegotiated every 10 years among Monroe County and the various cities within its borders, White said. Ten years ago, Forsyth saw its portion of LOST money drop by about 4 percent, White said. This time around, its about 6 percent, which amounts to about $300,000.
Despite the budget shortfall, Hall said city residents arent in danger of having any of their services interrupted.