TUPELO • City leaders on Tuesday afternoon approved a balanced general fund budget of $37.9 million for the next fiscal year with no new tax increases.

The Tupelo City Council unanimously approved the budget, which is largely the same as the current fiscal year’s budget, which will end on Sept. 30.

“We have a fiscally responsible and fiscally conservative budget that adequately meets the needs of our city,” Mayor Jason Shelton said.

The largest portions of the budget are the police department and the fire department, which combined make up around $17.4 million of the city’s total general budget.

To save money, the budget also eliminates some job positions in the city that were vacant. No employee was fired due to job eliminations, and the positions could be filled in the future if economic conditions improve.

The council also approved a $3.5 million capital budget with most of the funds in the capital budget going toward street repairs and maintenance.

A capital plan is a portion of the city’s budget that is allocated toward long-term or bigger-ticket projects.

Kim Hanna, the city’s chief financial officer, told the Daily Journal that around $13.7 million in “rollover funds” will also go toward the capital plan. Most of the rollover funds are made up of proceeds from bonded debt that has not yet been spent.

Some excess revenue from the current fiscal year is also slated to go toward the upcoming fiscal year’s capital budget. As a general rule, the city places all of its excess revenue into the capital plan to invest in future projects.

Nearly all of the council members praised the administration and city’s finance department for preparing a responsible budget in the middle of a global pandemic.

“I feel like all areas of the city will be able to receive some support in some financial way,” Ward 4 Councilwoman Nettie Davis said. “I am very pleased with every aspect of the budget. There may be something we might want to look at at the first of the year when the revenue might be looking a little stronger.”

The passage of the budget comes at a time when municipalities, which draw some of their revenue from sales taxes, have had to trim operating budgets because of the economic downturn linked to the novel coronavirus pandemic.

According to administration officials, the city experienced about a 1% decrease in sales tax revenue, and it’s projected to take an additional 1% revenue reduction for the upcoming year because of the COVID-19 pandemic.

However, the city’s property values this year increased by around $51 million, which helped alleviate some of the economic strains of the pandemic.

Ward 1 Councilman Markel Whittington said that he thought the administration made good decisions about cuts but believes further reductions may merit consideration.

“Hopefully, we will improve as the year goes on and this budget will become even better looking,” Whittington said. “But I compliment Kim (Hanna) and the administration on a job well done.”

taylor.vance@journalinc.com

Twitter: @taylor_vance28

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