The city of Mexico is proposing a new budget for the fiscal year 2024 that if approved would spend more than $24.6 million on city services.

City Manager Bruce Slagle and other city staff members presented the proposed fiscal year 2024 budget that will begin Oct. 1 and run through Sept. 30, 2024. The city will hold a public hearing this Monday, Aug. 28.

The city is projecting more than $23.3 million in revenues which is a difference of close to $1.3 million to the negative. Those funds show negative because some projects that were to be completed in the 2023 fiscal year are carrying over and will be reconsidered once the city receives transfers from the state and federal governments for grants. The city was awarded close to $5 million in federal funds from the American Rescue Plan Act (ARPA).

The ARPA grant money was used to purchase a new fire truck and a housing incentive program. The city will also embark on two large stormwater projects thanks to the ARPA funds.

“We feel this is a very sound budget, a strong budget,” Slagle said. “We think it delivers some great value and provides outstanding services to the citizens. We also think it delivers on some infrastructure projects that we’ve had planned for some time. We think we’re hitting on several things that have been in the works for some time.”

Slagle said there are still some lingering effects from the COVID-19 pandemic as the city transitions into an endemic phase. He said the city continues to be mindful of national trends and economic indicators.

The city is anticipating generating about $150,000 in new revenue from a three percent sales tax on cannabis sales that was approved by voters in April. Those funds will be used for the Mexico Public Safety Department (MPSD).

The city’s largest funding source is from intergovernmental transfers, most grant funds, to the tune of about $7.5 million. The city is expecting to collect about $4.8 million from sales tax and close to $4.6 million in charges for services.

The city is expecting about $1.35 million in property tax revenues while gross receipts taxes are expected to generate about $1.7 million. Transfers and miscellaneous income is projected to generate about $2.9 million. The city is expecting about $200,000 in licenses, permits, fines, and forfeitures.

The city’s biggest expenses are expected to be capital outlay like the stormwater project at close to $10 million. The city will also spend about $10 million on services. The city is expecting to spend about $1 million on debt service while more than $1.8 million will be transferred to other funds.