Thu October 29, 2009
One-Time Revenue Paying Kansas City's Bills
Kansas City, Mo – Kansas City's Finance and Audit Committee got a wake up call yesterday, in the form of the latest revenue and expense figures. For one thing, revenue may be starting to lag behind projections by several million dollars. But there was more.
City budgets being what they are, revenue and expenses are averaged, parceled out in tidy monthly amounts. But in the real world, bills come due when they come due, collections may be slow, there may be one-time windfalls - and committee chair Deb Hermann says what she found out late Tuesday cost her a sleepless night.
Hermann: "That we have a 2.5 percent fund balance accrual instead of the 7.5 percent that the council had thought. To me last night it was like 27 million dollars disappeared. The biggest concern to me is why didn't the council know it? And speaking of one-time revenue - if the council had not done that, we would now be insolvent."
Hermann was referring to the council putting fifteen million dollars in one-time windfalls, including an 11-million-dollar AT&T settlement in the general fund. She is asking the finance department for a more detailed report by next week, including steps to take to start bolstering the city's bank account.