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The best time to invest?
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The best time to invest?

The best time to invest?
Photo Credit: Stephanie Brown
View from the Riverplace Tower

The best time to invest?

Mayor Alvin Brown wants to invest $11 million in savings from refinanced bonds back into the city, but he's getting some advice from the city council auditor: wait a while.

City auditor Kirk Sherman says want him to hold off until after the city can see how funding shapes up for the rest of the fiscal year. WOKV looked over the quarterly report from the council auditor's office which higlights several concerns the office has about spending within the general fund. 

The city has approximately $16.9 million in its general fund.  It says the Mayor's Office reports JSO saved $8.7 million but JSO says it only saved $4.5 million, a difference of $4.2 million.  Revenues are projected to be short of the projection by $1.7 million, and property taxes were also short of projection about $1.6 million.

"...When the approximate $16.9 million favorable variance in General Fund expenditures is reduced by the $4.2 million overstatement within the Office of the Sheriff and the $11 million proposed appropriation of debt service savings [from refinancing city bonds at lower rates], the projected favorable variance in expenditures is reduced to approximately $1.7 million.  This amount would be negated by the projected ($1.7 million) unfavorable variance in revenues and the overall positive variance would be eliminated." This serves as a correction what we had reported earlier.  "This agency is not over budget.  This administration has never been over budget.  This issue is the difference in a budget surplus," said Laurie Ellen Smith with JSO.

Sherman says the bottom line is how cautious the city wants to be in a situation where budget projections for the year so far don't say enough about where the city will be in a few months because it's still early in the year.  If the $11 million is moved Sherman worries the city's general fund might dry up, and while he admits being at zero is better than being in the red, it's definitely better to have some wiggle room.

"We definitely want the city council to consider all its options," said Sherman.

He says if the mayor ends up moving the $11 million to the necessary funds for economic and downtown development, it could mean possible layoffs, program defunding, or postponed projects if the budget projections stay static.  It's not easy to move the money back once it's gone either, so Sherman says in the event that the city needed the money or had an emergency, it would be harder to transfer those funds back to the general fund.  Regardless of what happens city council will have to approve the movement of that $11 million, and Sherman has some advice for the mayor and the council.

"If you do decide to go through with this plan, be careful when you make the next step."

While he says he thinks the audit is fair and fiscally responsible, city council president Bill Bishop tells our partner Action News he doesn't really agree with the auditor's report.

"With respect to what that money is and where it came from, not entirely, no," says Bishop.  "$9 million dollars, while it's a lot of money, it's not enough to solve all the problems or all the ills of downtown, not even by a half or a third."

Another councilman, Matt Schellenburg, says the Downtown Investment Agency, who is supposed to get the $9 million for downtown development, still doesn't have an executive director or a plan to spend that money.

"I think it's important to make sure that we don't make promises to give organizations money before we see the overall scope."

Meanwhile, businesses owners downtown like Jacksonville Landing owner Toney Sleiman want to see that money spent.

"We need money downtown.  If I was a betting man, and I am a betting man, the mayor's going to win this one."

Sleiman thinks the mayor is going to put the money into downtown regardless of what the audit says.  City council still has to approve any transfer of funds that the mayor would want to do, including moving that $11 million into the economic development funds where it could be used for improvement.

WOKV reached out to Mayor Brown for comment and his office released the following statement:

"The administration is reviewing the guidance provided in the Council Auditor's report. We will consider the recommendations as the remaining nearly three quarters of the year proceed and we review revenues, as administrations have historically done.  Reinvesting the savings in Downtown and economic growth will provide a longterm benefit to our city's taxpayers by increasing  private investment and economic growth in Jacksonville. We are committed to Mayor Brown's reinvestment plan to add value to Downtown and brings more jobs there and across Jacksonville."

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