Lexington mayor’s $505M budget includes money for possible new city hall, senior center

Lexington Mayor Linda Gorton unveiled a $505 million proposed budget that includes money for a new computer intelligence system for police and millions of dollars for designing a new city government center and a second senior center on the city’s south side.

Gorton’s budget proposal unveiled Tuesday is also historic: It’s the first time the city’s budget has surpassed $500 million.

It includes no tax increases and a 5% raise for most city employees not covered by unions.

It also includes money for other design and construction projects including $750,000 for site selection and initial design costs for a new combined police and fire training center and $2 million toward a redesign of Phoenix Park on Main Street in front of the Central Library.

“This is a big budget,” Gorton said. “For the first time our city’s general fund budget has risen above $500 million. It’s serving a big city with many needs.”

The budget for the fiscal year that begins July 1 now goes to the Lexington-Fayette Urban County Council for its review. If the council makes changes, it must do so by June 30.

The $505 million budget is a roughly 7% increase over the current-year budget of $473 million.

The city is relying on $43.3 million in one-time money to help it balance its books. That money is coming from current-year projected surplus and other city savings accounts.

It is using $38.5 million in borrowing or bonding to buy police and fire vehicles and fund other capital projects. The $38.5 million includes $12 million in borrowing for paving. In total, Gorton’s budget includes $14 million for paving.

A new ‘intelligence unit,’ plus money for senior center, city hall

One of the new initiatives in public safety proposed in the budget is the creation of a new real time intelligence unit.

Gorton is asking for $150,000 for software to help it use the city’s more than 130 traffic cameras, Flock license plate reader cameras and business and residential cameras to help police catch criminals, Gorton said.

In addition, the budget will include money for two full-time analysts to help staff the new intelligence unit, she said.

“I want to be clear, our investment in this software technology along with license plate readers and recorded traffic cameras will not be used for traffic tickets — this is against state law,” Gorton said.

“Technology is the future,” Gorton said. “Like the Flock program, intelligence software will enable us to solve crimes faster, support our officers and strengthen the cases we take to court because there will often be video to back up witness statements.”

Another segment of Fayette County’s population that has steadily grown is its over 55 population. The city’s Senior Center on Life Lane has been operating at capacity for years. Moreover, much of the city’s older population is on the south side. It’s time the city open a second senior center, she said.

“Our programs for our growing senior population are in great demand and make a significant contribution to the health and wellness of our older residents,” Gorton said.

Gorton’s budget proposal includes $1.4 million for design of a second senior center and therapeutic recreation facility in Shillito Park off of Reynolds Road. The original proposal for the new center was near the pool.

Sally Hamilton, the city’s chief administrative officer, said the city has opted for a site near the fire station at the front of the park.

Another item that has long been on the city’s to-do list for decades is finding a new home for city hall. The city has spent hundreds of thousands of dollars on studies to find a new location and move out of its current location on Main Street, a former hotel, and several other buildings in the downtown area.

“A space study is currently underway to tell us what size our new home needs to be — consultants will learn everything possible about how our city operates now, post pandemic, so that we can plan for the future,” Gorton said. “I have built $6 million into this budget to take the next steps to make good decisions for a new city hall, including the professional services we will need.”

Police and fire training facility, parks

Lexington fire has needed a new training facility for some time, Gorton said. Gorton’s proposed budget includes $750,000 for site development for a new combined police and fire training center.

The city currently leases space from Bluegrass Community and Technical College for its police training academy. The city hopes it can find land it owns for a combined facility, Hamilton said.

Other big-ticket items in Gorton’s budget include money for development of more parks and green-spaces.

The city has spent $26 million in American Rescue Plan Act funding in the city’s parks. Gorton’s budget includes some additional money for parks projects. Those projects include:

• $1 million to develop Deer Haven Park, located in the Hamburg area. Park already has mountain bike trails. Money will go toward drinking fountains, parking and benches.

• $2 million to overhaul Phoenix Park in downtown Lexington. City has already set aside $1 million toward the $4.6 million projected cost for the project. City hopes private fundraising will help with remaining costs.

• $500,000 to help with site development and clean up for newly acquired property along the Kentucky River, which will eventually become the city’s first water access for paddlers.

• $2.1 million to replace the pool at Douglass Park, which has had frequent maintenance issues over the years.

Affordable housing, homelessness, social services

Gorton’s budget largely keeps funding to affordable housing and homelessness the same as prior years.

The city will allocate $2 million to affordable housing and $750,000 to homeless intervention programs. There will be an increase to a competitive grant program for social service organizations, commonly called the extended social resource grants, to $4.3 million.

The city also hopes to be able to fund a separate program that allows nonprofits to apply for grants for one-time capital expenses, such as for new roofs and HVAC systems.

“Like affordable housing, social services has a number of programs that reinforce public safety,” Gorton said.

The council is considering an ordinance that would require the city to set aside 1% of its total revenues for affordable housing. If it passes, that ordinance would not take effect until 2025.

Gorton said the city has already set aside $13 million in American Rescue Plan Act funds to affordable housing.

Revenue sources

The money for the city’s $505 million spending plan comes from several sources:

• $461 million in revenue through tax collections and fees

• $24.6 million from a projected current year surplus

• $17 million that was set aside by council to pay for bonuses, wage increases for public safety

• $1.8 million from previously dedicated money for E911 retention money.

The city’s projection of $461 million in revenue is a steep increase from the current-year revenue projection of $419 million.

As of March 30, the city’s projected surplus was $29.4 million for the current fiscal year that ends June 30.

Its two major revenue sources — a payroll tax (or a tax on wages) and net profits (a tax on businesses) — have consistently beat revenue projections, said Wes Holbrook, the city’s director of revenue.

The city is confident that those revenue increases will continue and are more in-line with the revenue growth the city has seen coming out of the coronavirus pandemic, he said.

The city’s revenue projections have also been developed in consultation with the University of Kentucky, Holbrook said.

Gorton said the city is being fiscally responsible and only spending one-time money on one-time projects, she said.

“This budget is solid. It’s strong. It will do great things for our city and her people,” Gorton said.