Budget for Website - Flipbook - Page 15
We must be conscious of the stock market as it has impacts on our operations, especially on our
legacy costs. The Dow Jones Industrial Average ranged between roughly 36,611 and 50,512
between early 2025 and early 2026. A falling stock market will negatively impact our MERS
actuarial accounts and impact those former employees who are on the old defined benefit
program. A long-term downward trend or recession will decrease stock market values and
increase our costs to fund the old Defined Benefit Programs. You will recall that the Defined
Benefit program was eliminated 25+ years ago as the city broke away from the old governmental
model of doing business. A falling market will also negatively affect all current employees who
have the 401K style retirement program.
We are concerned about the 35th District Court as they will soon be a significant expense for the
city, as they are continuing to operate at a deficit. The Court is independent of the city, and we
do not control their operations. They are also anticipating a major capital expenditure program,
which expenses will be passed along to the five communities. It should be noted that we
predicted that there would be no need for a third judge and related staff in 2001 and 2002 and
that the cost of adding a judge (in 2003) would lead to a situation where the court would become
a cost center for the city. A reduction in judges would come from a study by the State Court
Administrative Office but could be initiated by the communities as a cost savings measure. In this
budget and beyond, the cost of the court may have significant impact on local budgets as the
court will merely present their budget deficit and put it on the shoulders of the five local units to
fund. Further, there is legislation to have the state take over the court system statewide and the
concern is that this will be another state program that is not fully funded to meet expenses, leaving
the local units to meet the funding obligations on behalf of the state.
We have remained fiscally disciplined, living within our means despite ongoing challenges,
increased state and federal regulations, and high inflation in recent years. The City Commission
has prioritized upgrading our vehicle fleet and has made several purchases, but significant
replacement needs remain. Costs for new police vehicles and pick up trucks for Municipal
Services or the Recreation Department have almost doubled in less than 15 years, while the costs
for new larger equipment has increased exponentially. Some deferment in larger purchases over
the past few years allowed the fund to rebound some and build some reserves. These reserves
allowed significant purchases for a front-end loader, backhoe, and skid steer last year, while this
year, there are plans for an additional Swaploader with a leaf collection attachment to enhance
bulk leaf pickup, as well as a new Vacuum style rodder truck used in the maintenance of the water
and sewer systems. Trucks of this size and specialization are seeing almost a year and half lead
time from order to delivery.
With limited funding for capital purchases, especially those that impact the General Fund, and
the City has looked to prioritize projects where we can obtain grant funding to match our funds.
The Lion’s Club and Rotary Club have made significant contributions to providing matching funds
to support upgrades of their sponsored parks and we anticipate both of those projects to be
completed this year. Staff has spent a significant amount of time meeting with the Lion’s Club as
well as the neighborhood and public in general to work on design elements before a plan can be
brought forward to the Commission to seek authorization on that park. The same or similar
approach will be used in planning for Rotary Park, and we anticipate that beginning in April.
There are other parks which need some general maintenance and repairs/replacements of
certain pieces or parts on play equipment and city staff will again conduct inspections and put
together the list and cost estimates to inform decisions on priorities. There are also park areas
which could be due for full upgrades based on the age of the equipment and it might be time to
City of Plymouth 2026/27 Budget
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