In a report to the Wildwood City Council on the 2021 budget, Interim City Administrator Steve Cross stated that planned expenditures totaling $16 million will be fully funded from a combination of revenues that are conservatively anticipated at $15.8 million, plus fund balances projected to be $26 million.
The city is highly reliant on sales tax revenue to fund annual operating expenses, Cross said. It receives a prorated share of the 1% sales tax that is collected and disbursed through a complicated distribution formula known as the county tax pool. St. Louis County oversees the tax pool, which voters approved in 1978. Wildwood also receives a 5% gross receipts tax from utility providers.
The 2021 municipal budget is divided among six active funds, with the three major funds being the general fund, the capital improvement sales tax fund, and the road and bridge fund.
During the public hearing on Nov. 23, Cross said the general fund shows total revenue for 2021 projected at $10.4 million. Of that, almost 90% is made up of general sales, utility and public safety taxes, he said.
Expenditures in the general fund are estimated to be $10.7 million. Almost half of that ($4.9 million) is for the contract with St. Louis County Police to provide police services.
“I look forward to extending our contract with St. Louis County Police,” Mayor Jim Bowlin said. “Our crime statistics are among the best, and Capt. (James) Mundel and his team do an outstanding job for our residents.”
In late 2017, the city began receiving funds from Prop P, the county’s public safety sales tax, which was approved by county voters in the April 2017 elections.
Cross said expenditures will be fully funded by 2021 revenues and Prop P public safety funds.
The general fund balance on Dec. 31, 2021, is estimated to be $16.8 million and with a 25% contingency, which is set aside every year, and a $1.1 million public safety reserve. That leaves just over $13 million in the unreserved general fund balance to be used for city operations.
“That is a very, very healthy reserve,” Cross said.
As the city council begins its 5-Year Strategic Goals and Objectives discussion, a key topic will be a review of potential solutions to address the city’s long-term financial sustainability. Cross said the city will evaluate the feasibility of increasing current sources of revenue, such as fees, or creating new sources of revenue to assist in sustaining its level of services.
The second reading of the 2021 budget will take place at the Dec. 14 council meeting.