Columbia is focused on a service-driven 2025 budget. What it aims to fund

Columbia is focused on having a service-driven budget for 2025, says city finance director Matthew Lue.

Instead of a typical budget message with a speech by City Manager De'Carlon Seewood, various department leaders, like Lue, were welcomed by Seewood to provide budget highlights as the city moves into its public input phase for the budget.

Columbia City Council will hold a budget work session 2:30 p.m. Monday, which starts first with a closed session on sealed bids, before the open session in the council chambers. The council then will hold budget public hearings during its regular meetings on Aug. 5, Aug. 19 and Sept. 3 ahead of the final budget vote Sept. 16. The city's budget year runs from Oct. 1 through Sept. 30.

The city has proposed a $558 million budget, roughly $12 million more than in 2024 or a 2% increase. This includes roughly $532 million in revenue. It is typical for the city to have greater expenses than revenue in the budget due to capital improvement projects that are supported by multi-year appropriations from various sources, including sales taxes.

The city maintains at least 20% in reserve balances, which help the city float for three months if there is some issue that requires tapping reservices, such as a natural disaster. If reserves dip below 20% there is a funding mechanism in place to get it back to that 20% level within three years, Lue said.

The city receives roughly $58 million in grant funding from county, state and federal sources.

While the city's revenue projections are roughly 2.5% increases year on year, above the typical 1.5% increase, expense projections are increasing at a greater pace, roughly 8%, Lue said. This is both down to the city updating employee classification and compensation for 2024, but to a greater extent inflation.

"That is an issue we'll have to keep an eye on and is becoming a problem as the city continues to grow and add additional services. We only have so many resources to fund our expenditures, so in the future we may need to explore ways to increase our current revenue sources or additional revenue sources," Lue said.

One way the city is planning to combat increasing expenses is a water rate increase , which if approved, could go into effect Oct. 1. A first read of the water rate increase was part of the council's July 15 agenda and a presentation and public comment is likely at the Aug. 5 council meeting.

Capital projects; affordable housing; community violence prevention; public health and human services

As the city moves toward its 2025 budget year some major capital improvement projects are part of that. This includes Phase 2 of the Columbia Regional Airport terminal , which upgrade a building just south of the terminal to provide offices for airport administrative staff, Transportation Security Administration staff and car rental services; MKT Trail maintenance; Clear Creek sewer; and Forum Boulevard widening .

Projects are funded by the city's capital improvement sales tax, which its current 10-year period ends Dec. 31, 2025. Voters will have an opportunity to vote on the next 10-year collection period Aug. 6 . If approved, the new 10-year term starts Jan. 1, 2026.

The city formed its Housing and Neighborhood Services department through the 2024 budget. It is supported by federal Community Development Block Grants and HOME funds from the Department of Housing and Urban Development on an annual basis. The city also has provided upward of $13 million toward affordable housing and homeless services through American Rescue Plan Act allocations. The city and its partners, including Central Missouri Community Action, Columbia Housing Authority and Love Columbia have received funds.

The city also seeks to establish a $1.5 million affordable housing trust fund in 2025. This will be supported through general fund reserve surplus and city staff are working to develop the framework for the trust fund. The city and county will participate in a housing summit Oct. 24.

More: Columbia aims to 'lead the market' on employee pay as 2024 budget approved

The city also aims to establish an office of violence prevention through the 2025 budget. This is funded separately from the city police, fire and health departments. Upward of $500,000 of the office's budget is to provide grants to local organizations already conducting violence prevention work. The city also has partnered with the National Institute for Criminal Justice Reform , which will help the city develop a strategic plan for the office as its work develops and moves forward.

Some work already is underway with Homeless Outreach Team from the city's police department and the city's DIVERT program coordinated by Columbia/Boone County Public Health and Human Services. The city aims to add another social service specialist for the DIVERT program in 2025. The police department also centralized training, recruitment, public information and internal affairs through a new Bureau of Professional Standards. That bureau has helped with attracting officers to fill vacancies in the department, said Police Chief Jill Schlude.

Since the 1970s PHHS has provided funds to other service organization to help fill gaps the department does not have the capacity to offer. Funding is done in opposite years for basic need programs and opportunity programs, the leg up. Services funding will increase about 3.2% in the budget, to roughly $1.9 million. The city continues to help fund the Ashley Street Center and Room at the Inn, so it can operate year round rather than just over winter months. Utility assistance also was increased within the last year from $300,000 to $600,000 and that amount also is in the 2025 budget.

More: De'Carlon Seewood celebrates 'year of accomplishments' in state of the city address

Charles Dunlap covers local government, community stories and other general subjects for the Tribune. You can reach him at cdunlap@columbiatribune.com or @CD_CDT on X, formerly Twitter. Subscribe to support vital local journalism.

This article originally appeared on Columbia Daily Tribune: Columbia is focused on a service-driven 2025 budget. What it aims to fund