Wilmington budget woes “not that bad”

Despite more than two months with local shops and businesses shuttered due to the stay-at-home order put in place due to the COVID-19 pandemic, the city of Wilmington’s finances look to be somewhat stable.

Matt Hoffman, finance director for the city, told members of the Finance Committee on May 19 that the projected deficit for the 2021 fiscal year (FY21), which began on May 1, is currently anticipated to be around $300,000.

The proposed budget for FY21 includes a total of $18 million in revenues across all city funds. That includes $4.1 million into the general fund, a decrease from the FY20 budget of $5.4 million.

But the proposed FY21 budget puts spending from the general fund at $4.4 million, creating that $300,000 deficit projection.

The biggest expenditure from the general fund is police operations, estimated at $2.1 million for FY21, a slight increase of $53,000 over the previous year.

Hoffman said revenue for the city’s general fund— its main operating fund that covers administration and the police department — is currently down about 24%

“Expenses we’ve managed to keep flat from the year before, and actually shaved off about 8% from the projected budget. That’s where about one-third of our deficit comes from, city wide,” Hoffman told the committee.

So far, city leaders said lost revenue from lower sales taxes has not been as bad as it could be, since grocery stores, gas stations, car dealerships, liquor stores, and general goods are still being sold, and some restaurants are still operating as carry-out.

Hoffman said as of right now, the city will likely return to 75-80% of revenues collected once the stay-at-home orders are lifted and more and more businesses reopen. Hoffman said city leaders will have to wait until later in the year to see what the real numbers are.

City officials were encouraged by the news.

“We’re not going to be that bad, sales tax I don’t think it’s going to be that bad, we’ll hang in there,” said Mayor Roy Strong. “I think our loss will be the gaming tax, it’s about $10,000 a month and we’ll lose that. But I think we’ll be alright and we can hang in there. I think we can really be doing well in our budget, not over spending... I think the only department that’s going to spend most of its money is probably the police.”

Hoffman added that each department is being conservative with revenue projections, and trying to be as conservative as possible on spending.

The city of Wilmington will hold a public hearing regarding the proposed FY21 appropriation ordinance on June 16 at 7 p.m. at City Hall.