Lexington's Urban County Council on Tuesday gave tentative approval to a $289 million city budget for fiscal year 2013 that includes up to 2.5 percent raises for city employees and $1.25 million to begin a detailed design study for the area around Rupp Arena.
Salaries for council members, Mayor Jim Gray and his appointed staff will remain at the same level as this year. There will be no tax increase and no layoffs.
The general fund budget approved Tuesday goes onto the docket for a special meeting June 19 for first reading. It will receive a second reading on June 21. Final approval must come by June 30, the last day of the 2012 fiscal year.
With the exception of a few changes, council approved the budget presented by Gray in April.
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In general, the 2013 budget is more optimistic than the city has seen in several years. It is an increase of 5 percent over last year's budget.
"Overall, it is a pretty good budget," Vice Mayor Linda Gorton said, adding that Gray had started the process by proposing a reasonable budget.
For the first time, council and the mayor and his administration had a budget retreat early in the budget process to discuss priorities. "That set the stage for us to be working together more than in the past," Gorton said.
Gray said it was encouraging to have council and his administration work together on what is essentially a spending road map for the city. "Council has worked really hard. These are tough times, and the council's hard work is very reassuring for our community," Gray said following Tuesday's work session.
Council's budget will be reviewed by the mayor and his commissioners, but Gray indicated he did not think he or his commissioners would find problems with it.
Council added $125,000 for a bathroom at the Arboretum on Alumni Drive. "It's something that's been needed for years," Gorton said. The Arboretum has more than 200,000 visitors a year. From 5 p.m. to 8 a.m. on weekdays and weekends, the bathrooms in the visitor's center are closed. There is only one portable bathroom.
A few budget highlights:
A 2 percent raise for non-union employees, and 2.5 percent for those who are paid less than the city's median salary.
Civil service employees have not had a salary increase since 2010, when they received 1 percent raises. The salaries of police, firefighters and corrections officers — who are union employees — are negotiated as part of their contracts.
A provision to give each council member a cost-of-living increase of a few hundred dollars was defeated when council split on a 5-5 vote. Council has not had a pay raise since 2007. Council members make about $26,000 annually; the vice mayor takes home $28,000.
An increase of 1 percent in the franchise consumer fee on natural gas and electricity. The money will pay for street lights in areas without them inside the urban service area.
Savings of several million dollars in health care costs. These will come from increased health care rates paid by employees, coupled with savings realized through the city's new wellness center and in-house pharmacy.
$1.25 million from existing bond proceeds to go with state money for preliminary design work for the Arena, Arts and Entertainment District, which includes the Rupp Arena area. The state legislature has approved $2.5 million in planning funds over the next two years to be matched by Lexington. When Gray first proposed this expenditure, some council members voiced skepticism. However, Gorton said when the $1.25 million came up in a council budget subcommittee for a vote, it passed without dissent.
A $50,000 monthly contribution to the city's rainy day fund.