With little discussion last week, Ocean City Council members approved financing for three capital projects and an amendment expected to decrease reserves needed to balance the Fiscal Year 2023 budget.
The budget amendment, which passed first reading Aug. 7, shows a decrease in the estimated amount of money needed from the prior year reserves to balance last year’s budget from nearly $12.6 million to more than $6.3 million.
Council members passed the second and final reading of the amendment in a 6-0 vote, with Councilman Will Savage absent, at a meeting Aug. 21.
In summary, the budget amendment recognizes increased revenue estimates of $3.7 million from sources including room and admissions taxes, and interest in investments. Revenue increases from building permits, Medicaid reimbursement, grants and donations equaled $2.1 million.
The amendment also includes adjustment of the advertising budget. The fund is set to get $600,000 through a city ordinance, and another nearly $600,000 from a state tourism grant.
There was also some offsetting of higher expenses in the transportation and water funds, and most notably, worker’s comp claims.
A significant change in the risk management budget required an additional $350,000 to cover more than $1 million in worker’s comp claims. The staff report said most of the total was covered by savings in other areas of departmental budgets.
Other details of the budget amendment include $73,000 from casino revenues going to street paving, adjustments for higher energy costs at the convention center following last year’s expansion, and increases for chemicals for the water department and parts for IT.
Council members last week also approved with a 5-1 vote, with Savage absent and Council President Matt James opposed, to reimburse expenses for three projects in the capital improvement plan.
The first two, reconstruction and rehabilitation of Montego Bay streets for no more than $4.5 million and installation of a 94th street bayside water main for up to $2.2 million, were initially approved in March.
The other project, design and construction of a mixed-use police substation and housing facility on Somerset Street for no more than $4.26 million, was originally approved 6-1, with James opposed, at a work session Aug. 15.
James said during the Aug. 21 meeting that he does not oppose funding the first two projects, only the mixed-use building.
“I don’t think project three is the best use of money at this time, in that location, for this project,” he said.
City Manager Terry McGean also clarified that the annual debt service on the project, which will be split in half with the Ocean City Development Corporation, is $300,000, making the city contribution $150,000 a year.
This story appears in the Sept. 1, 2023, print edition of the OC Today.
