Special Board of Aldermen 07-01-2021 Page 8
With regard to the revenue side, it is an estimate in this budget book anyway. So to the extent grants don’t
come in as timely as we would like or want, that revenue would be offset by the grant, the amount of grants
that come in. So at the end there would not be surplus with that nor would there be appropriations in
excess of revenue.
Alderman Jette
OK could | follow up?
President Wilshire
Alderman Jette?
Alderman Jette
So | don’t know if you or Attorney Bolton would be more appropriate to explain, why would we, as this
grant money why would not be able to accept it without doing what you are suggesting tonight? What
prevents us from accepting that money.
Mr. Griffin
Well kind of the tactical accounting side of it is you are going to be outside the limitations of the cap, that’s
a potential. Attorney Bolton might have a more legal answer than that.
President Wilshire
Attorney Bolton?
Steve Bolton, Corporation Counsel
The issue is two-fold; the State Law currently with the passage of Senate Bill 52 and it is being signed by
the Governor takes effect 60 days after it was adopted by the House — that is mid-August. Supplemental
appropriations that are made to this budget will after that date in August have to conform to the budget
limitations, the so-called Spending Cap Provisions of the City Charter which means that you cannot
exceed last year’s total budget by more than a percentage of a 3 year rolling average of this certain
government index. Just estimating that perhaps that amount would be approximately $3 million dollars
that increase - $3 million dollars. But we have never in the past included grants as being part of that whole
spending cap calculation. So it wasn’t in last year’s budget. But if you look at the law as it currently exists
or will exist come that date in mid-August, it says that a Charter can provide for exceptions for grants,
Enterprise funds, gifts, and other revenues from sources other than property taxes. And those can be
exempted in the Charter. Our Charter doesn’t exempt them. So if we can only raise the budget that we
passed last year by $3 million dollars well we would not be able to accept and appropriate grants. And we
are expecting grants of approximately $77 million. This is money that we get from other sources, not from
property taxes.
So it makes sense to say, OK let’s put in the budget, just like you do with other things, put in the budget
the amount you expect to receive in revenue from grants and the amount you expect to spend of those
grant monies, typically you’d have to spend them all, they are not giving you money just to hang around,
there are things you are supposed to do with it. And that’s in light of what one of the public commenters
said earlier, you take the revenue you subtract the appropriations and the amount left is what has to be
raised in taxes and that’s exactly correct. And that is what this proposes to do, it proposes to treat these
grant revenues just like any other revenues and expenditures from those grant revenues just like other
expenditures. And the reason we want to do that now is because of the way the law now reads with the
recent legislative changes. And we are dealing with sort of shifting sands situation, trying to react to
