Proposed budget authorizes WVC city manager take out $3.5 million from rainy day fund if needed

By Travis Barton | [email protected]

The West Valley City Council approved a tentative budget in early May that would allow City Manager Wayne Pyle to take $3.5 million out of the general fund, more often known as the rainy day fund. City administration would only use that money if needed.

With multiple cities across the valley hit hard economically by the COVID-19 pandemic. West Valley City is no exception. The proposed budget for the upcoming fiscal year starting July 1, projected a 17% decrease in sales tax revenue, almost $5 million less than the adopted budget from last year.

Pyle told the council in an April 28 study meeting that interest on income and sales tax revenues would take the largest hit.

“We are definitely going to be hit by this from an economic standpoint,” Pyle said, but adding they didn’t know “how hard.”

Numbers from sales tax revenues don’t come in until two months after the fact, making the situation hard to project. Though city officials have asked 20 of the city’s largest businesses to send those numbers in quickly to get an earlier picture.

The proposed $85.5 million budget includes no cuts to services, notably the police or fire departments. It does include a hiring freeze and little in new funding.

The $3.5 million would be delayed expenses. Mayor Ron Bigelow, who spent his career as an accountant, preferred that money not be included in the budget at all. Since the council meets on a weekly basis, they have the flexibility to make modifications as needed, Bigelow said.

He added he’d like to wait a little longer to get a better picture of the economic landscape.

“It’s an interesting time, it’s a difficult time to budget accurately,” Bigelow said.

But rather than go through a budget opening process, Pyle said he’d prefer to have the money already in there to give him more maneuverability.

“The budget is balanced,” Pyle said prior to the May 5 vote. “We are asking for significant flexibility in terms of using the fund balance, however, our intent is that actually we think with the structure of this budget, if the economy isn’t worse than what we projected, we could very likely still be at the same level of fund balance as we are currently at the end of next year. We don’t know that for sure, that’s why I’m asking for the flexibility.”

The mayor, who served as the chair of the house budget committee during the last recession, reiterated several times he felt the budget was balanced. He was simply worried about hitting the fund balance too much too early, preferring to limit it to $1 to 1.5 million.

“I’m not a fan of being too quick to draw the money out of our fund balance or rainy day fund,” Bigelow said of his only concern with the budget. “But it is a concern because I tend to be very conservative on financial matters, more so than most.”

Councilman Tom Huynh said he would prefer to use the rainy day fund rather than increase property taxes, though the mayor did not suggest raising property taxes.

“When it’s a rainy day, we pull the money out of the general fund, that’s what it’s for,” Huynh said. “Some people are struggling to pay mortgage, rent and put food on the kitchen table for family…I’m OK using money from general fund to cover for this time and hopefully we’re gonna get over this.”

Councilman Steve Buhler was “pleased” the budget did not include layoffs or a decrease in services, as well as a healthy fund balance that’s been built over the years since the last recession “so that we can maintain status quo as best we can” for the near future.

He said they don’t know what the future holds, whether there is a “complete shift in society and the way governments function. But as for now, we have set a course to continue business as close to usual as possible.”

The tentative budget can be found online at wvc.ut.gov. The council will vote on the final budget on Aug. 11 when residents can also comment publicly.