The Ypsilanti City Council will consider several proposed budget amendments at Tuesday's meeting, including committing $3.3 million of the fund balance for future Water Street debt repayments.

Council will also consider re-allocating $100,000 from the South Grove Road paving project to North Prospect Street's design engineering plan.

Pete Murdock

City Council Member Pete Murdock submitted the budget amendments for Tuesday's meeting and the council is slated to consider an ordinance to amend budget appropriations by department for the 2012-2013 and 2013-2014 fiscal years.

Reallocating $100,000 for North Prospect Street design engineering

Murdock said Prospect Street is in terrible shape and is in desperate need of repair. In the 2012-13 budget, council has allocated $100,000 for Grove Road out of the general fund.

"It's a wreck," Murdock said. "It gets a lot of traffic and we've had drainage problems with it. It's getting worse and worse. It's basically close to the condition of Grove Road. It's a mess now."

Murdock said the city no longer needs to allocate the money toward the Grove Road project, which he said is now fully funded.

"We had Grove Street basically scheduled for 2014 or something like that and there was some additional funds that were available that allowed us to push it up. So I've said why don’t we just allocate it to do the design for Prospect in the event that if some money does get freed up, we have a project to get ready to go."

Murdock said he believes to pave Prospect, it would cost around $1 million.

"We don't have any money in the queue to do it at this point," Murdock said.

However, Murdock said in the past, the city has been successful at taking advantage of excess road money that becomes available when other municipalities do not follow through on their projects.

By having projects designed and ready to go, the city took advantage of the American Recovery and Re-Investment Act to accelerate the construction of College Place and East and West Cross streets, as well as other funds to move Grove Road up from 2015 to this year.

Murdock is recommending the city complete the design and engineering plan as soon as possible by adding it on the proposed contract with Orchard, Hiltz and McCliment.

Committing $3.3 million from the fund balance for future Water Street debt repayments

Murdock said during the past several years, the city designated a portion of the fund balance as committed for future Water Street Debt payments. Murdock said this year’s proposal by City Manager Ralph Lange eliminated that.

Murdock is proposing committing $3,300,588 to the debt. Murdock estimates that it will leave the city with about $2,750,281 in unassigned fund balance at the end of fiscal year 2013-14, which is close to double the city's 10 percent requirement.

Ralph Lange

"We didn't know he did that until the last meeting," Murdock said. "The money is still there, it's just unallocated and I think that distorts our financial picture.... We need to restrict it just so people don't think it's a big pot of money. It needs to pay that payment."

The amount the city committed or reserved in the past has always been equal to two or three years payments, Murdock said. On June 30, 2012 there was $2,647,222 of fund balance reserved for the Water Street Debt.

"By committing a portion of the fund balance for Water Street debt, we provide a hedge or cushion to provide for the near term debt without drastically reducing services," Murdock wrote in his budget amendment proposal. "Since our five-year projection contains deficits throughout, there will be a need for fund balance transfers for the debt payments in the foreseeable future."

Murdock is suggesting the city continue that practice and restrict an amount equal to what is needed to keep it solvent through fiscal year 2015-16. At that time, Murdock believes the city will be able to refinance the bonds and re-evaluate and possibly use any unused funds to further reduce future debt payments.

The city will likely pay $24.7 million on the Water Street debt through 2031, unless it refinances the debt. According to the city's debt repayment schedule, it owes 16,550,467.87 in interest through 2031 and $15,740,000 in principal.

The next payment, $435,070, is due Nov. 1.

Reinstating the Downtown Development Area police officer

Murdock said three years ago, the city partnered with the Downtown Development Authority in funding a dedicated police officer to patrol the DDA commercial areas.

The costs of the police officer, a little over $60,000, were split 50-50 between the two.

Murdock is proposing the city reinstate the police officer to provide a visible presence in the commercial areas. Murdock said the city would contribute $30,150.

"The officer who was there was great, we just didn’t have enough boots on the ground to be able to do it," Murdock said. "They’ve (DDA) always allocated their half for it, but we haven’t been able to do it for at least a year."

Murdock said the program was well received by the business owners and residents and was successful in dealing with problem issues, but the reduction in police personnel in the last year has not allowed for the position to be filled.

Murdock said the DDA is still supportive of the program and has budgeted funds in 2013-14 for their share of the costs of the police officer.

A new officer would have to be hired to fill the position, Murdock said. It would be in addition to the three additional road patrol officers that have already been budgeted for in 2013-14.

Halting the drain from the Motor Pool fund

Murdock said the city has been using the motor pool fund, the fund that pays for the city's purchases of vehicles and maintenance, to balance the general fund and other budgets. Murdock estimates the city has used about $1 million each year.

"By doing this, we are eating into the cash reserves that have been set aside for vehicle and equipment replacement," Murdock said. "We’ve been using the motor pool to subsidize other operations. You can only do that for so long."

The recent motor pool report shows that at the end of fiscal year 2013-14, the city should have $4,222,170 available for the replacement of vehicles and equipment, but will only have $2,430,067 available cash for that purpose.

"I would like to set a floor of what we are willing to allow this fund to fall to," Murdock wrote. "I would recommend that we restrict $2.5 million of the fund balance to future vehicle and equipment replacement."

Other proposed amendments:

• $100,000 for Peninsular Dam inspection and repair
• $5,000 for improvements to the electrical system in Riverside Park
• $1,000 contribution to the Washtenaw Health Initiative
• $2,740 to become a “Parkridge Partner” of Parkridge Community Center
• $6,000 for playground equipment at Candy Cane Park and Charles Street Lot

The Ypsilanti City Council will consider Murdock's amendments at the 7 p.m. meeting in City Hall.

Katrease Stafford covers Ypsilanti for AnnArbor.com.Reach her at katreasestafford@annarbor.com or 734-623-2548 and follow her on twitter.