By Carol Cole
The Norman Transcript

The city of Norman ended the year with an about $2.3 million surplus, which apparently took several city leaders by surprise.

City Manager Brad Gambill said Friday that only about $300,000 of that amount was due to sales tax, with the rest coming from franchise taxes, use taxes from the Internet and other taxes such as revenues from the state tobacco compacts.

"The problem is that it's not audited yet," Gambill said. He said with some of the funds, like the tobacco money, it was a surprise that it is as much as it is. "But it's all good news."

He also gives credit to city employees for the surplus.
"The city work force worked real hard on reducing expenses," Gambill said. "It's all a combination of these things."

The city's most recent estimate for fiscal year 2006 general fund revenues is about $57 million, with estimated expenditures of $54.7 million.
Gambill said he had planned to present the news to the city council at its first budget retreat Sept. 28.

He said the city did not know of most of that income when voters went to the polls Aug. 22 to vote on an extension of the half-cent, five-year sales tax, which expires Sept. 30.

The city council will ultimately determine how the surplus monies are used.
But the city manager has his wish list of where the revenues should go.

"We aren't planning any capital projects, like Oklahoma City did," he said, noting the city of Oklahoma City councilmembers announced earlier this week they will spend the city's $6.7 million surplus on roads, traffic signals and spraygrounds.

Gambill said after the city funds its reserves and health insurance program, it would leave only $712,000. Of course, that's if council takes action in that direction.
By policy, council has directed that the city have 8 percent of its general fund held in reserve.

"We have fallen short of that for many years," said city finance director Anthony Francisco on Thursday to participants in the Norman Citizens Academy.

Francisco said the city does not have a specific, restricted-use rainy day fund, but holds its reserve in the general fund by not appropriating a certain amount of those funds.

He said the surplus figures had not been presented to the council yet because of their preliminary nature.

Gambill said he is hoping to provide a cost-of-living adjustment for certain employees who've sacrificed as the city has cut employees because of tight budgets during the past few years. The city is in negotiations with its unions.

The city manager said he knows city staff will take heat for having a surplus after appealing to voters based on its lean coffers.

"The info we had going into that -- we were in dire straits," he said. "But most of this information came in after the Aug. 22 election."

And the $2.3 million is a fraction of what it's estimated the temporary sales tax would have produced -- about $35 million over five years to fund additional police, firefighters, other key personnel, economic development and city reserves.