Learn about La Grande budget

May 09, 2012 02:17 pm
On Monday, May 14, the City of La Grande Budget Committee will begin public hearings on the City’s budget for all funds, including Urban Renewal.

In anticipation of those hearings, I thought it would be beneficial to provide some insights to help people understand what can be a fairly confusing subject.  

Lately, the most often asked questions seem to center around the differences between the City’s General Fund and Urban Renewal Agency’s Fund.  

Specifically, why can’t we use funds from Urban Renewal to hire more police officers, restore hours at the Library and Pool, or fix our roads instead of helping fund façade improvements or doing the Big H streetscape project downtown?

 To begin with, it may help to explain what we are talking about when we use the term “Fund.” Think of a fund as a separate budget or checking account. Each account is set up to collect revenues and pay the bills associated with the services provided.

In the City of La Grande, we have our General Fund, several Enterprise Funds, as well as the separate Urban Renewal Agency’s Fund. The key distinction between the General Fund and the Enterprise Funds is where the money comes from and what we can use the money for.

The primary sources of revenue for the General Fund include property taxes, franchise fees and user fees. The General Fund is used to pay for the services provided to the community as a whole, and includes administrative services; police; fire and emergency medical services; library; planning and zoning; and parks, recreation and aquatics. 

 Enterprise Funds include the Water Fund and Sewer Fund and are essentially the same thing as a separate business and are intended to be self-supporting. Think of the Water Fund as if it were a private business that sells water to the customers.  The money generated from those sales is used to pay only for the operation of the water business. We can’t legally use
revenue from water customers to buy things like police cars or pay for
recreation programs. We also do not use
property taxes to pay for things in the Water Fund or any of the Enterprise Funds. 

 Like the Enterprise Funds, the revenue generated by the Urban Renewal Agency must be used for specific purposes, in this case the implementation of the Urban Renewal Plan.

In the way of background, in 1999, the City created an Urban Renewal District.  As the properties in the District increase in value, the tax revenues on this increased value are reinvested in programs that have a direct benefit to the District or for projects physically within the District as described in the Urban Renewal Plan.  

To clarify, we cannot use Urban Renewal dollars to improve property that isn’t physically inside the District.  Likewise, we can’t use it to provide
services such as public safety.

 It is difficult in a few paragraphs to fully explain the City’s budget or the complexity of how Urban Renewal works, so I would invite you to attend the budget hearings at the Colleen F. Johnson Community Room in the Cook Memorial Library at 6 p.m. on May 14. We will start with Urban Renewal and have an overview of the entire City budget. The public will have an opportunity to comment on the proposed Urban Renewal budget Monday night and on the City’s budget Tuesday. 

 Hopefully, this brief overview will help you understand that the various activities and operations within the City are paid for by several separate and distinct funds with individual revenue sources and, in some cases, have strict limitations on their use.

As City Manager, part of my job is to answer questions that members of the community may have, so if you would like more detail on our budget, please don’t hesitate to call on me. I can be reached at (541) 962-1309 or you can e-mail me by clicking the “Ask the City Manager” button on the City’s website. 


Robert Strope is the La Grande city manager.