BILLINGS — Billings voters helped the city dig out of a $4.7 million budget deficit after passing a public safety mill levy, allowing the city to retain staff and not make more cuts to the 2021 budget, said Chris Kukulski, Billings city administrator Wednesday.
"So, the great news is that we no longer have a $4.7 million deficit. That deficit is closer to $500,000 and that’s manageable. So, really our revenues are much closer to our operations expenses," Kukulski said.
On Tuesday, voters approved a mill levy that brought in $4.2 million in new money to the city. The vote repealed and replaced a levy previously passed in 2004.
The new levy will bring in more money as more people and businesses move in, increasing the tax base. That's different from the 2004 levy, which was capped at about $8 million annually and never brought in more during its lifetime.
"We are unfortunately completely a property-tax-driven system. So it really relies on investments in property. When additional homes get constructed or businesses get constructed that’s when that tax base grows and thus brings in a bit more revenue each year to help offset the increased costs," Kukulski said.
Part of the reason for the initial deficit was the city hired 20 additional public safety staff between 2017 and 2020, Kukulski said. The positions were added in the police and fire departments along with 911 dispatch.
The passage of the levy helped to avoid layoffs for those positions, but doesn't allow money to grow public safety services, Kukulski said.
"This avoids us going back to staffing levels say of 2016, 2017 and that’s really great news because with not only our crime rates and response times have been a challenge for us, all the demands for service are going up," Kukulski said.
Over the past 10 years, calls for service to Billings police and firefighters have nearly doubled, according to data provided by the city.
Kukulski expects the upward trend to continue as the city grows.
"That’s the kind of trend that we can’t reverse on the status quo. We’ve got to figure out how to be more efficient, more effective, and I’m going to be shocked if it’s not going to require some additional resources in order to do that,” Kukulski said.
After learning of the election results Tuesday night, Billings Mayor Bill Cole said it's "probably inevitable" that the City Council will bring another mill levy ask to voters.
The increased calls for service could be lowered by adding additional staff paid for with a future levy. Kukulski also mentioned other areas of traffic enforcement and specialized policing to focus on crime that could be paid for with another levy.
“We can lower our crime rates to levels that I think will make a significant impact on our economic viability as a community. Ultimately, that’s where we want to get. We want to see fewer victims ... Those are the conversations that we will get into fairly quickly I think in late 2020 and early 2021 as to what’s next," Kukulski said.
The City Council was previously looking at a larger ask that would have expanded public safety services. It opted for a smaller levy in light of the economic downturn brought about by the COVID-19 pandemic.
Kukulski said one silver lining is that the city will hear results from a public safety study done by third-party company, Center for Public Safety Management. In the study, city leaders will learn more about the city's needs from an outside perspective to make informed investments for the future.
Results should be in by the end of the year, Kukulski said. The study also includes a statistically valid, random survey of citizens to gain their perspective.
Under the new levy, the owner of a Billings home worth $100,000 will see a $27 increase on their property taxes, totaling $81 per year. The owner of a Billings home worth $200,000 will pay an additional $54 per year for a total bill of $162 per year.