Since its readers, likewise, care a great deal about Tupelo, I want to correct a somewhat misleading headline of a recent front page which read “Neelly, Reed Biggest Borrowers.” More importantly, I want to discuss what I believe is a wise path of financial stewardship as we move Tupelo ahead.
Tupelo has over 30 different funds to administer, with multiple revenue sources and multiple expenditures. One of those funds is our “general fund” which handles the day-to-day operation of city government. It would equate with a “checking account.” One of those funds is our “savings account,” officially referred to as our “unrestricted fund” – sometimes informally referred to as our “rainy day fund.”
The article in the Journal explained to what extent Tupelo mayors have transferred funds from the “unrestricted funds” account to our “general fund.” It is just like a family needing to buy school supplies and transferring money from its savings account to its checking account.
Here is the important point: We did not borrow this money from a lender, which then would need to be paid back. We simply transferred it.
As our city fiscal year ends Sept. 30, I fully expect we will add money to our savings account because we ran our city responsibly and will come in below budget. Despite the recession, the City Council and Mayor just passed our second straight balanced budget, thus not requiring us to use any of our savings for operational needs.
Our unrestricted funds balance is $16.8 million dollars.
According to respected municipal financial advisors a conservative balance for a city is one quarter of its general operating budget. In our case that is one quarter of $34 million or $8.5 million. To be even more conservative, I have set $10 million as a safe reserve fund amount. That leaves us over $6 million dollars which is currently earning us less than $600 monthly at .12 percent interest.
Tupelo has made some great strides in the past three years, both financially and in beginning to address some revitalization issues that must be solved. Citizens and leaders are ready to build on these successes and really create a Tupelo renaissance.
To do that, without raising taxes, many of us believe we should redeploy some of our extra savings into action.
This fall the City Council and I will be carefully studying the very best, smartest ways to success.
We know the citizens approve of this ongoing work to demolish blighted areas and turn bad places into good places. We know we need to build a new police headquarters; some funds are already set aside for that project, but some more may be needed.
We know we need to address paving or overlay areas.
We know we need to intelligently attack substandard housing – rental and home owned – as we insure that “every part of town is a good part of town”.
We know we need to do everything we can to support our Tupelo Public Schools and their neighborhoods.
There is a serious request for a new Lee County Library.
The CDF, along with the City, the County, and private developers continue to examine game changer projects to set our area apart in this new century.
None of these projects can be accomplished in a single year. All are worthy of our best consideration. The needs certainly exceed our current resources, but we can afford to take some important first steps.
The final, important point is this: We do have $6 million dollars to wisely deploy toward solving some of them, and it won’t be “borrowing.” It will be investing money we already have.
Contact Tupelo Mayor Jack Reed Jr. by email through Sally.Williams@tupeloms.gov.