Kearney City Council Special Meeting - July 8, 2024: Budget Presentation and SportsPlex Update
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Kearney City Council Special Meeting - July 8, 2024: Budget Presentation and SportsPlex Update
The Kearney City Council held a special meeting on July 8, 2024, at 7:00 a.m. in City Council Chambers. The agenda included a presentation of the proposed 2024-2025 city budget by Finance Director Kayla James and City Manager Brenda Jensen, and a staff update on the SportsPlex by Sports Manager Lauren. No public comments were heard, and no formal votes were taken. The meeting adjourned after discussion.
Proposed 2024-2025 Budget Presentation
- Overall Budget Trends: The general fund increased by 4.1% ($1.5 million), while total city expenditures decreased by 17% ($27 million) due to the completion of major capital projects. About 60% of expenditures are for operations (personal services, supplies, contractual) and 39% for capital and debt.
- Personnel: A 3% cost-of-living adjustment is planned, costing $732,000 across all funds. The city added 8.67 positions in FY2023-24 and proposes new positions for FY2024-25, ending with 363 total positions. Employee and employer health/dental premiums will increase by 10%, adding $14-$35 per month depending on coverage.
- Capital Outlay: Total capital outlay decreased by $35 million (46.3%). Top projects include the Kearney SportsPlex ($10 million budgeted for FY2024-25, $23 million spent to date), airport apron reconstruction ($8.7 million, with a 10% city match of ~$500,000), wastewater treatment plant upgrade ($39 million project near completion, final $5 million via revenue bonds), Highway 30/University roundabout ($3.2 million, city share $300,000), 30th Avenue overpass repairs ($1.7 million), Cotton Mill Road replacement ($552,000, shared 50% with county), lead service line replacement ($4 million, 28% loan, 72% grant), Centennial Park playground ($400,000, mostly donated), and Memorial Field turf replacement ($307,000). These nine projects constitute 67.5% of all capital expenditures.
- Debt Service: The city begins FY2024-25 with $117 million in outstanding debt, plans $5 million in principal payments, and expects no new debt issuance, ending at $112 million. Annual bond payments total about $10 million including interest.
- Revenues: Total revenues are projected to decrease by 8% ($9 million). Tax revenues (sales, property, occupation, motor vehicle) are up 6% ($1.7 million). Property tax is estimated at a 4% increase (3% base + 1% growth), though final valuation comes August 20. Sales tax is conservatively estimated at 3% growth (actual year-to-date is 5%). The city’s property tax levy remains at 0.14887 per $100 of valuation, the lowest among Nebraska first-class cities. Revenue breakdown: charges for services 37%, taxes 27%, internal services 9%, others 25%.
- Property Tax Distribution: Of every property tax dollar, Kearney Public Schools receives 66 cents, Buffalo County 18 cents, the city 8 cents, and other entities 8 cents.
- Fund Balance Policy: The city maintains a policy of at least 25% of operating expenditures in most funds, which supports bond ratings and financial stability. All funds meet this policy for FY2024-25.
- Fee Schedule: Landfill rates unchanged ($42/ton uncompacted, $35/ton compacted for all haulers). Sanitation collection up 6% (~$1/month). Sanitary sewer up 7.5% (year 3 of 5 annual increases). Water up 7.5% (after no increase last year). Stormwater no increase. SportsPlex fees included in new schedule.
- Challenges: Sales tax growth remains marginal, cost escalation persists, health/dental costs rise, workforce recruitment is difficult, and future property tax policy is uncertain. The city receives no municipal equalization funding (a neighboring community received over $2 million last year), which is deducted from the state’s sales tax pool.
SportsPlex Staff Update
- Revenue and Expenses: Projected FY2024-25 revenues of $590,000 (concessions, hourly rentals, sponsorships, and a $25,000/month visitors bureau endowment starting March 2025). Expenses estimated at $1.18 million, with staffing and utilities comprising 88%. The $592,000 shortfall will be offset by Keno Funds, not property or sales tax. City staff noted that Keno Funds have been used for similar purposes (e.g., golf course, overpass).
- Opening Timeline: March 2025 soft opening, with first events anticipated in April. Weather delays (wind and rain in May) have set back construction slightly, but contractor MCL is optimistic.
- Event Bookings: For April–September 2025, 6–8 special events confirmed. For October 2025–September 2026, 17 confirmed events and 7 pending, plus a month-long league. The first major non-local event is a three-year contract with Nebraska Supreme Basketball (three tournaments annually). Local partnerships include Rick Squires volleyball (moving from UNK), Dalton Jensen/Loper Legacy Fund, Kearney High and Middle School wrestling, Kearney Matcats, and Nebraska Sports Council (Netfest volleyball and pickleball).
- Staffing: Five full-time positions (sports manager, senior facilities maintenance worker, sportsplex coordinator, admin assistant at 35 hours, and an additional facility maintenance worker later). Three part-time facility monitors (67 hours/week total) and 16 seasonal employees (ambassadors/concessions, 227 hours/week). At least three staff on-site at all times for safety.
- Hourly Rates: Court rental $18/hour, pickleball $16/hour, turf (1/3, 2/3, full) $25/$50/$100/hour, batting cage $12.50/30 minutes. Drop-in play $6 for two hours; punch cards available ($40 for 10 punches).
- Operations: Reduced summer hours (close 8 p.m. instead of 10 p.m., Sundays open at noon). The facility will be closed on major holidays. A robot floor cleaner is being considered to reduce labor costs.
Key Outcomes
- The budget presentation was informational; no formal action was taken. The council will discuss the budget further at a joint meeting with Buffalo County on July 11, 2024, at 3:00 p.m. (law enforcement needs assessment) and 4:00 p.m. (budget and interlocal agreements). A joint public hearing (pink postcard meeting) is tentatively scheduled for September 17, 2024.
- The SportsPlex update was received favorably. The council noted the use of Keno Funds to cover the operating shortfall, consistent with past practices. No formal motions were made.
- The meeting adjourned at the conclusion of the presentations.
Meeting Transcript
By statute, a current copy of the open meetings act is available for me to post it on the wall. Take roll, please. Mayor Klaus Bushcutter clear absent Nicola More. Here. Okay, an agenda item three is a presentation of the 2023-2024 budget by Kayla James and Brenda Jensen. Morning, Kayla James, Director of Finance. Here we are again. I can't believe how quickly this rolled around. I did change this first slide here to include just the word highlights because it was a little misleading. This really isn't the budget. We'd be here all day if we were looking at the budget. So throughout this presentation, feel free to ask questions or have start some discussion because there's lots of things that we can talk about. This is the time to do it. So here we go. Starting with proposed expenditures by fund. And this would be comparing last year's budget to this year's budget. The general fund increased 7% or about $1.5 million for personal services. Supplies and materials increased about $600,000 or 5.3%. And our capital outlay expenditures decreased about $700,000. And then the general fund does not have any debt service in it, so that would be zero. In total, the general fund went up about $1.5 million or 4.1%. And we will start talking about some of these different components of the general fund here in a bit. The other funds, um, we had a decrease of $28 million in the other fund expenditures, mostly because of the capital projects that we have been doing this year and working on. We've had a lot of expenditures that we will not have next year. And we'll we'll discuss that later too. And so in total, the city of Kearney budgeted expenditures went down about $27 million or 17%. And kind of a fun fact for all the expenditures, about 60% of those are for operating, so personal services, supplies, materials, and contractual services comprise about 60% of the budget. And capital and debt represent about 39% of the budget. And the other funds there that we're talking about special revenue fund, capital projects fund, debt service fund, enterprise fund, internal service fund, and fiduciary funds, they're all kind of lumped together in the other funds there. So and if there aren't any questions, I'll just keep going. Starting with personal services, um a three percent pay plan adjustment is planned uh for cost of living adjustment, and this this one will cost the general fund or the governmental funds, excuse me, about $517,000. And the governmental funds would include the general fund and the transportation fund. These are most of the tax supported uh parts of the of the general fund. And then it will cost the proprietary funds about 215,000. So it's the the three percent pay plan adjustment in total is gonna cost about 732,000 dollars. Um the number of employees we started uh we're working in the 2324 budget right now. We started with 346 employees during 2324. We added 8.67 employees, and under the new, the new would be what we're proposing uh new positions for 2425 to end up with an ending number of 363 positions, and I have detailed down here down below the um 2324 mid-year additions um in the middle there, and then the 25 are the new positions that are proposed. And you can see um, I I wanted to put on here we didn't just add positions, we also reduced positions or eliminated positions and like an easy one. Um we added Brad, the assistant to the city manager, but we took away the deputy city manager, so a lot of things were moving. Um, some of these that I did not include up here that kind of were um moving a position eliminating this but adding that in it in within the same department. So it this list would get too lengthy to include everything, and then we are proposing a 10% increase in both employee and employer health and dental premiums this year. Um, just to give that a little bit of uh clarification. We project we're gonna have 4.6 million dollars worth of medical claims this year to pay. We have a few large claimants, and we also will have 1.2 million dollars of health reinsurance to pay and our health reinsurance to give you some context. And our health reinsurance, to give you some context, our monthly premium that we pay for health reinsurance increased from $52,000 a month to $81,000 a month. So that hurt a little bit. That cost us about $350,000. So that cuts us a little short. The reinsurer kind of took it deep last year because we had some high claimants, and anybody who had medical expenditures over $150,000, they had to pick up the rest.
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