The City of Sisters is in very solid financial shape.

The City is now over halfway through its fiscal year, which ends June 30, 2021. According to the second quarter financial summary (through December 2020) prepared by Finance Director Joe O’Neill, the City is in good shape, with three revenue sources already exceeding the amount budgeted for the entire 2020/21 FY.

On the expenditure side of the budget, three categories (capital outlay, 21 percent, materials and services, 43 percent, and personnel services 44 percent) are at less than 50 percent spent at the halfway mark for the fiscal year. Some revenue and expenditure amounts are impacted by the timing of income and outflow.

A majority of the property tax revenue comes to the City in November and December, and is already at 106 percent of budget, which puts the City on track for an overall collectability greater than expected. In 2011, the collection of property tax revenue amounted to $773,000, increasing each year to the proposed $1.45 million in the 2020/21 budget.

“We significantly rely on our property tax rate, which is low relative to Bend. That is made up for with having a lot of valuable properties to tax,” said City Manager Cory Misley.

The City sat in the favorable position of beginning the fiscal year with a general fund balance almost $844,000 over the projected $12,472,537.

Misley stated in this year’s budget book: “Fortunately, the City did an excellent job last decade, keeping up with demand on services and not falling behind on essential infrastructure. We have a diverse array of revenue sources and have been diligent in accumulating thoughtful reserves for the respective services. As growth continues and the Sisters Country Vision encourages us to aim higher, we must continue to evaluate every tool in the toolbox.”

The budget book is available on the City website, www.ci.sisters.or.us, under government, documents and reports, budget information, Fiscal Year 2020/2021.

“We are in a very good financial position largely because we have a good variety of income sources,” Misley explained. “We are in a good position to make things work.”

System Development Charges (SDCs) income has continued to exceed expectations (128 percent) as development growth continues. Builders of both residential and commercial properties are required to pay SDCs on new construction to cover the costs of new sewer, water, park, and street improvements necessary as a result of growth. That way, existing residents are not having to pay for the cost of expansion. With regular review, the City has been able to keep up with the cost of SDCs.

Despite the pandemic, transient room tax (TRT) income has also exceeded the year’s budget amount at 102 percent, with tourist months of May and June still to come. Tourism has been a driving force in Sisters’ economy since the 1970s. Tourists spend money in local businesses. Their local lodging cost includes a TRT that goes directly to the City with a percentage going to tourism-related activities. Sisters also has the advantage of having a local gas tax, with tourists’ fuel purchases helping pay for street and paved trail creation and maintenance.

Another source of revenue is camper fees from the City’s Creekside Campground, which is open from April through October, and basically full throughout the summer.

“We remain confident in the face of the economic uncertainty COVID-19 has presented. The City is well-positioned to weather and rebound from these challenges. We should remain optimistic about our community and take a proactive yet measured approach to this fiscal year. One critical component is that our economy is more diverse and sustainable than ever. We are more well-positioned than ever to weather economic headwinds. It is vital that we continue to invest and prioritize furthering that resiliency,” Misley reported.

Misley explained that there are other cities in Oregon which are losing population or in a stagnant position. Sisters’ growth increases the amount of resources and at the same time increases the amount of expenditures — creating the demand for a budgetary balancing act. The health of the City’s coffers enables proactive planning for the well-being of the community.

City Hall is currently operating with 17.5 full-time equivalent positions (FTE), which is fewer than the 20 FTE in 2009. Staffing and labor costs include salaries, healthcare benefits, Public Employee Retirement System (PERS) contributions, workers’ compensation insurance, and property and liability insurance.

In last week’s Nugget, City Manager Cory Misley provided an overview of the City’s budget process (see related story) and what goes into determining budget projections for each fiscal year.