The Urban County council will consider a proposal Thursday that would set aside $3.75 million of a $7.6 million surplus for capital projects in council member districts.
If approved, each of the 15 members of council would receive $250,000 to spend on capital projects over the next fiscal year, which ends June 30.
The council voted 8-6 during an Aug. 27 work session to put the proposal on the council meetings' agenda. It scheduled to receive a final vote at Thursday's meeting.
The vote will likely be close. If approved, it will be the largest one-time money ever given to council members to spend in their districts in recent years.
Mayor Jim Gray declined to say last week whether he would veto the $3.7 million in spending if it is approved Thursday. If Gray opts to veto the $3.7 million in spending, it takes a two-thirds majority — or nine of 15 members — to successfully override Gray's veto.
Gray urged council members to be cautious.
"It has taken a lot of hard work and many tough decisions to put our city's finances on the right track, and we need to stay on the right track," Gray said. "I would encourage the council to carefully consider all spending decisions and weigh all community needs ... with a view toward creating jobs and opportunities for our citizens."
Many council members say their districts are starved for infrastructure improvements after years of lean budgets. Neighborhoods — where the bulk of taxpayers live — have seen little or no capital investment, they argue.
But other council members say the city's finances are still fragile; now is not the time to go on a spending spree. More money needs to be socked away in the city's rainy-day fund, they argue.
Chris Ford, 1st District councilman, supports the proposal. During the Aug. 27 work session meeting, Ford said the surplus was $7.6 million and probably will grow after the fiscal year 2013 books are closed in the next few months. The city has more than $18 million in its rainy-day fund, he said.
"We've met all of our required contributions," Ford said of the rainy-day fund.
Ford, who represents the east side of Lexington, said he would like to spend money improving parks and possibly address road projects that have not received funding in past years.
"The use of these funds would be an investment," Ford said. "They would address some needs that have been long-standing in our districts. These investments would enhance the quality of life for all residents."
Kevin Stinnett, 6th District councilman, said the council does not receive money for capital projects for council districts.
"We've funded the mayor's priorities," Stinnett said in a telephone interview.
Other council members said that despite belt-tightening in recent years — including revamping the city's health insurance program and controlling pension costs — the city is borrowing too much and not saving enough. Others questioned whether it was appropriate for individual council members to decide how the money is spent or whether the council as a whole should decide what projects should be funded.
Vice Mayor Linda Gorton, who voted against the proposal during the council work session, said last week that there were many projects on the city's to-do list.
"We should be looking at our total needs," Gorton said. "We should have a list in front of us. We haven't had any capital projects for basically three years. Everything has been put on hold."
For example, the council has not financed the completion of the Legacy Trail or the completion of the Downtown Arts Center, Gorton said.
Gorton and Ed Lane, 12th District councilman, argued that the city needs to put more money into its rainy-day fund. The more than $18 million in the fund is not enough. The goal is to have $30 million, or roughly 10 percent of the $300 million general fund.
"That's not enough for a city of our size and for a budget of our size," Gorton said.
"We don't have enough cash on hand for emergencies," Lane said.
In fiscal year 2012, the last year that audited financial statements are available, the city spent $300 million from its general fund but collected only $283 million in revenue. That means the city spent $16.9 million more than it had in revenue. To plug holes, the city has relied on one-time money — mainly borrowing. The city's debt has nearly tripled in nine years, from $119 million in 2003 to $312 million in 2012, Lane said.
"It's a joke to say that we have this surplus money, when we're actually running in the red," Lane said.
In 2005, the council approved roughly $1.5 million or $100,000 for each of the 15 council districts after the city had a surplus. Gorton, who voted against the previous proposal, said some council members could not spend the money by the end of the fiscal year. It created accounting head aches for the city to track what was supposed to be one-time money, she said.
But other council members said the council can set parameters to ensure that the money is used wisely and in a timely fashion.
Jennifer Mossotti, 9th District councilwoman, who voted for the measure, said during the Aug. 27 work session that she does not think "anyone on this council would use this money to benefit themselves."
"If it is not spent in a year, it goes back to the general fund," Mossotti said.
Mossotti said in a telephone interview that she understands how important it is to put money into the rainy-day fund and pay for other projects, such as buying new fire trucks. But she also has other needs in her district that are public safety concerns, such as the Reynolds Road roundabout — which she says is one of the most dangerous intersections in Lexington. The $250,000 could be used for blinkers or signs to make that road safer, Mossotti said.
"I also still have roads that flood during heavy rains," Mossotti said. "I know paving is an issue throughout the city and county."
How they voted
On Aug. 27, Urban County Council members voted 8-6 to include on Thursday's agenda a proposal that would set aside $3.75 million of a $7.6 million surplus for capital projects in council member districts. If approved, each of the 15 members of council would receive $250,000 to spend on capital projects over the next fiscal year, which ends June 30. Here is a breakdown of the vote at the August work session:
Council members who voted for the proposal:
■ Jennifer Mossotti, 9th District
■ Kevin Stinnett, 6th District
■ Chris Ford, 1st District
■ Diane Lawless, 3rd District
■ George Myers, 8th District
■ Peggy Hensen, 11th District
■ Shevan Akers, 2nd District
■ Jennifer Scutchfield, 7th District
Council members who voted against the proposal:
■ Vice Mayor Linda Gorton
■ Ed Lane, 12th District
■ At-Large Member Chuck Ellinger
■ Julian Beard, 4th District
■ Bill Farmer, 5th District
■ Harry Clarke, 10th District
*At-Large Member Steve Kay did not attend the meeting.
Beth Musgrave: (859)231-3205. Twitter:HLCityhall