Newport Taps Reserves for Budget but Remains Optimistic About Developments
The City of Newport is turning to its reserves to boost the budget just adopted by the city commission.
Like many cities, Newport was adversely affected economically during the ongoing COVID-19 pandemic.
"Even though we are entering unsure times, I am pleased with the direction that the city is heading," said Mayor Jerry Peluso, after the $20 million budget was adopted. "Our staff in partnership with the board of commissioners has done an outstanding job with limited resources and have been excellent stewards of our public finances."
$700,000 was moved from the city's reserves, and Commissioner Tom Guidugli, Jr. said that the city is taking a conservative approach to spending due to the ongoing uncertainty.
"This was a very challenging budget," said Guidugli, a candidate for mayor this year who is running unopposed. "It was already full of compromises and a fiscally responsible approach because we won't know for several months how this situation with the virus is going to turn out."
While the city used budget reserves to balance the spending plan, the city has an estimated $4 million in reserves that could be used if tax revenue coming into the city continues to lag, an announcement said
"Like other communities, we've taken a pretty big financial hit because of the pandemic," said City Manager Tom Fromme. "But we are still in relatively good shape as long as we continue to take a conservative approach to our spending and maintain a strong base of reserves. Because as much as we plan for a variety of scenarios, no one knows for sure how the situation with the COVID-19 is going to continue to play out."
Like many other Northern Kentucky communities, Newport provided incentives to help businesses during the crisis.
"We've done a very good job communicating and working with the business community," Fromme said. "There has been a lot of outreach from the city, and we've listened to their needs and been very flexible in responding to their needs."
Among the budget highlights:
- The city has paid off an estimated $1 million in debt.
- Staffing levels have remained relatively unchanged. Fromme pointed out that total employment has dropped by 33 positions since he became city manager. The vast majority of city employees work in public safety.
- A large portion of the public safety budget went for a new fire truck that cost more than $500,000.
- Total property tax collected came in about $2.9 million for the year.
- State pension costs continue to rise and now stand at 40 percent for hazardous employees such as police officers.
- Street, sidewalk and infrastructure improvements are being made, including along the flood wall and on U.S. 27, Grandview Avenue Carothers Road.
In spite of the downturn economically, development continues in the city, similar to what Newport experienced during the Great Recession, Fromme said.
"During and after 2008, we kept on building and saw the completion of the Southshore condo tower, the Vue180 and Aqua apartments and the very popular and successful Newport Pavilion shopping center," Fromme said.
"And now, the Ovation music venue is under construction," he said. "Citirama is planned for 13th Street. The Skypoint condos and Academy on 4th apartments are nearing completion. And renovations and expansions are underway at Newport on the Levee and the St. Elizabeth Physicians Urgent Care facility. Even with the pandemic, Newport's future is very bright."