The most intensive debate centered around the budget allocations for utility services, particularly the water, sewer, and gas departments. A notable discussion involved the water capacity fees, which were projected to bring substantial revenue due to anticipated development. It was proposed that these funds be earmarked for specific projects rather than used broadly. The water department budget included new equipment and software for water meters, aligning with previous council approvals. Further examination revealed that every dollar allocated in the budget must serve a specific purpose, emphasizing the importance of appropriate categorization of personnel costs within the water fund.

Concerns were raised about the professional services budget, drug testing costs, and bad debt collection fees. The professional services budget was reserved for unforeseen projects, including necessary engineering work. Drug testing costs of $250 were justified to ensure the Enterprise funds covered their own expenses, keeping general fund costs separate. Additionally, confusion regarding bad debt collections and the associated revenue from third-party collections was addressed.

A topic was the potential shift of utility billing clerks and supervisors from the general fund to the Enterprise funds to save nearly $200,000 for the general fund. This shift was debated with the understanding that utility billing costs should be funded by the utilities to ensure fairness. The need for clarity on revenue calculations and formal support through ordinances or resolutions was emphasized. The ongoing debate about the fairness of utility billing costs and administrative fees continued, recognizing the direct impact on utility customers.

Another discussion revolved around the financial health of the CRA and the implications of potential budget reductions. A concern was expressed that reducing the CRA’s operating budget could lead to a net $1.2 million deficit. It was suggested that a percentage reduction rather than excluding certain areas would provide more predictable income for both the city and the CRA. The importance of long-term predictability for the CRA was underscored, with suggestions that future councils should have limited ability to amend the budget significantly. Historical context was provided, recalling the CRA’s inception and the eventual hiring of a director once funding was secured. The council debated the challenges associated with properties south of Interstate 10, which had seen increases in property values due to favorable agricultural appraisal values.

The council also focused on the city’s sewer capacity fees, which had seen substantial increases compared to previous years. Projections for these fees had risen from $200,000 to $4 million, prompting questions about whether expenditures would align with these projections. Further discussion highlighted the maintenance costs associated with the sewer department’s vehicles and the importance of accurately reflecting these costs in the budget.

The gas utility was another major topic, particularly its financial stability following the loss of a significant customer, the chicken plant. Past discussions on transfers from the gas utility were recalled, with reductions made after extensive line-item scrutiny. It was argued that maintaining the gas utility as a city asset was preferable to transferring it to another provider, such as Okaloosa Gas, to retain control and avoid permanent loss. The council also debated the effectiveness of the city’s gas marketing strategies and the need for closer scrutiny of marketing funds. The possibility of outsourcing marketing functions to improve results was suggested, especially with new developments offering opportunities to expand gas services.

Sanitation services were also addressed, with ongoing frustration about the interlocal agreement with the county, which pays the city a lower rate per can than neighboring areas. The council proposed holding a special workshop to explore these issues further, emphasizing the need for timely resolution due to the county’s bidding process for waste management services.

Employee compensation was another concern, particularly the proposed 2.5% cost-of-living adjustment (COLA). A public speaker highlighted that this adjustment would only amount to $18 a week for city employees, insufficient to cover basic healthcare costs. The finance director responded. This increase would cost the city approximately $450,000, encompassing various employee-related expenses.

The council also reviewed the financial status of the airport, which had historically required transfers from the general fund to operate. For the current fiscal year, it was noted that the airport is breaking even and generating reserves. Discussions included the allocation of funds from the city’s utility services to support the general fund and the potential impact on water bills, which were perceived as high compared to surrounding areas.