Lexington has a projected surplus of $12.2 million six months into the fiscal year, city officials told a committee of the Urban County Council on Tuesday.
That means revenues are higher than expected and expenses are lower than budgeted for the fiscal year that began July 1.
The city budgeted $150.7 million in revenue for the first six months but has collected $154.7 million, plus an additional $400,000 from other sources. It had budgeted $136.4 million in expenses but has spent $128.6 million.
Melissa Lueker, the city's director of budgeting, told the Urban County Council's Budget, Finance and Economic Development Committee that there was no guarantee the city would close the books with a surplus come June 30.
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Personnel costs have been less than projected, which is not unusual. Those costs are likely to increase during the last six months of the year, Lueker said.
The city has had a mild winter compared to last year, when officials had to take money from other accounts to pay for salt and other expenses to keep roads clear, she said. Another rough winter could eat into any projected surplus.
Council member Richard Moloney pointed out that the city has had surpluses for several years. Moloney said that he didn't want the city to spend freely but that continuing to have surpluses every year might mean the city was being too cautious with its revenue estimates. Surpluses sound good, but the city also has a lot of pent-up infrastructure needs after years of lean budgets, he said.
"I want to make sure that we spend wisely," Moloney said. "But I want to make sure we are consistent every year."
City budget officials said they should have a better picture in February, after they determine how the city's major revenue streams — such as its occupational tax — are performing compared to previous years.