The city of Macon is entering the lean times again, when the bills stack up and the bean counters keep a close eye on the bottom line as city finances flirt with disaster.
Monday the city dipped into its reserves — socked away over the past few years despite razor-thin budget margins — and pulled out $1 million to pay outstanding bills. Even so, the city still owes some vendors on invoices going back to early June, according to a report from the city finance department.
This story has repeated itself for years in Macon as city leaders try to balance the city’s shrinking population with a desire to avoid employee layoffs and major tax increases. In past years, the city has had to take out Tax Anticipation Notes — essentially loans — to make it through the late summer and early fall.
That’s when government finances are historically precarious because property taxes don’t start rolling in until shortly thereafter.
The good news this year is that Macon doesn’t plan to seek a loan. The bad news is that it’s dipping into its reserves instead. The uncertain news is that no one knows how property tax collections will go.
The city, county and school board face a key date soon on that issue. They go before a Superior Court judge Aug. 25 to get permission to send out temporary tax bills this year. The county’s tax digest is in flux because of ongoing appeals of recently finished property revaluations, and leaders for all three governments don’t want to wait for those appeals to be resolved before sending out some kind of bill, generating revenue this fall.
Without that money, the city would fall quickly and deeply into the red. There is no plan B, Tom Barber, city finance director, said Monday. A “no” from the judge “would be catastrophic,” he said.
Even if all goes as hoped in court, it will be “touch and go” for the city for the next two months or so, Barber said. The city’s reserves stood at $5 million after Monday’s withdrawal. The city has other revenues to depend on besides those reserves, including hefty returns from a local sales tax. But with a $1.6 million to $1.8 million payroll to meet every two weeks, plus other expenses, the monthly costs easily outstrip the revenues without the boost from property taxes. The city is scheduled to get a $5.5 million insurance premium tax payment Oct. 15, which will offer breathing room. The hope, Barber said, is that property taxes would start flowing to the city in bulk about that time, too, once the judge signs off on temporary bills.
To contact writer Travis Fain, call 744-4213.