As the “Branson financial onion” drifts down “Branson’s Budget River” slowly unwrapping, layer after layer, the significance of the words of Branson City Administrator Dean Kruithof at a recent meeting become apparent. While stating that the effect of the current budget strain on the upcoming budget was very simple, Capital and Operating expenses would have to be cut back, he said, “The explanation regarding the current strain on the budget is much more complex.”
In trying to illustrate the complexities of the budget challenges facing the city, Kruithof used the analogy of a river to represent the budget. He pointed out there are any number of tributaries flowing into the river, each adds water and increased pressure and the river can hold only so much water. The very first tributary entitled “Fund Payback” contained, among other things, a $750,000 per year payment from the city’s General Fund to repay a loan taken out for the Branson Landing project using Branson City Hall and the city’s newest fire station as collateral for the loan.
Kruithof explained that “Fund Payback” contained a number of standing financial obligations for projects which had to be paid back out of the General Fund. He went on to say, “Our General Fund dollars are competing with all our other operational dollars. We had the pay back for the Rec Plex, we had the payback for Capital Projects most notably the ‘convention center.’”
While seeking clarification on why General Funds would have to be used to finance the convention center in addition to the TIF (Tax Increment Financing) Kruithof explained that, in general terms, $750,000 from the General Fund is paid per year to the state to lease city hall because it was used for collateral on a loan for the Branson Landing convention center project.
On Sep. 10, an email from Assistant City Administrator Frank Schoneboom furnished additional details on the lease. It said the $750,000 payment is made from General Fund monies earmarked for the payment and the term of the lease is for 62 years. Schoneboom said, “This lease is for the 2003 MDFB ( Missouri Development Finance Bond) issues which was primarily used for property acquisition for the waterfront (Branson Landing and Convention Center projects).” He also pointed out that the payment is made “to a trustee, who in turn pays back on the note” and that “City Hall and our newest fire station (#3) are used to collateralize this note.”
Kruithof’s initial comments were made at a special Saturday combination meeting of the Branson Board of Aldermen and all three of Branson’s standing committees, Personnel, Capital Improvement, and Budget and Finance held at the Branson Rec Plex Sep. 7.
For related article entitled "Branson revenue stable but financial system breakdown strains budget" click here https://bransoncourier.com/issue-40/breakdown_financial_sytem_kruithof-1000.html
Furnished Courtesy of the Branson Daily Independent.
