Fairhope approves $113.6 million budget

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.FAIRHOPE – Utility upgrades and other improvements increased Fairhope’s budget by 32 percent to more than $113 million.

The Fairhope City Council voted Monday, Oct. 11, to approve a budget that includes a total of $113.6 million for the General Fund and utilities. The total in the fiscal year that ended Sept. 30 was about $85.66 million.

Mayor Sherry Sullivan said most of the increase will pay for needed utility improvements.

“It’s a $113-million budget,” Sullivan said. “That’s a pretty significant increase and that has to do with some of the infrastructure that we’re going to be upgrading in the water and wastewater department, but, infrastructure and growth continue to be a priority concern, obviously, for me and the city and, I’m sure, for the City Council. Right now, the proposed budget has utility investments of $23.6 million and resurfacing projects of over $400,000.”

She said the budget totals do not include $10 million for sewerage upgrade costs or $6.2 million for the Working Waterfront Project, both of which are being paid for with a grant from the federal Resources and Ecosystems Sustainability, Tourist Opportunities and Revived Economies of the Gulf Coast, or RESTORE, Act.

The city General Fund, which pays salaries and other operating costs of municipal government, increased 0.3% from $33.49 million to $33.59 million.

The largest increase in the budget was a 120 percent increase in the Water and Sewer Fund, from $14.47 million to $31.86 million, Kim Creech, city treasurer, said.

She said wastewater infrastructure improvements are expected to cost $10.25 million. That total will include the cost of force main upgrades and sewer lift station upgrades, including generators, Equipment repair and upgrades of wastewater treatment plant.

Water Department improvements will cost $8.32 million. That total includes water main upgrades, water distribution system main upgrades, water plan and well upgrades and repairs, as well as office and warehouse improvements.

Both water and sewer infrastructure improvements being made on Church Street are also part of the costs, she said.

Other utility spending included an increase in the Gas Department from $7.86 million to $9.65 million and in the Electric Fund from $23.4 million to $24.99 million, according to budget reports.

Council President Jack Burrell said much of the utility spending increases can be paid without borrowing or by borrowing for a short term.

“With all of the improvements to the electrical substations, about $12 million or $13 million, we’re not borrowing any money for that,” Burrell said. “With all of the improvements to the gas, I believe the way that pans out we’re not going to borrow any money to make the gas improvements. Water and sewer, we’ll burn through the cash as long as we can and then we’ll borrow very short-term borrowing on that and that’ll be paid for five times quicker than any other city in the country would pay for it, I can tell you that. We’re not floating a 30-year bond or anything or a 20-year bond, it’ll be a five-year plan.”

Sullivan said other improvements in the new budget include more environmental and parks funding.

“This year the budget has $2.9 million in park investments and that includes a regulation track at Founder’s Park, some upgrades to restroom facilities, some improvements at the Boys and Girls Club, four new baseball fields including new LED lighting and restroom facilities, new lighting at several parks and, again that does not include $6.2 million from the RESTORE grant that we will make in our waterfront project,” she said.

The budget also includes longevity incentive payments to recognize employees’ service to the city. Workers who have been with Fairhope less than five years will receive $250. Employees with five to 14 years of service will be paid $500 and anyone who has served 15 or more years will get a payment of $1,000, Sullivan said.

Creech said local taxes make up the largest share of city revenue in the budget at 38 %, followed by property taxes at 22 %. Licenses and permits are expected to bring in 13% of city revenue.

The largest single area of spending in the General Fund is for public safety, including police and fire protection at 26% with general government at 25%, according to budget reports. Culture and recreation make up 22% of General Fund spending with 18% for public works.

Fairhope’s new fiscal year began Oct. 1.