City faces budget crisis as reserves dwindle

During a recent government meeting, officials from the city of Newnan addressed concerns regarding the city's budget surplus and reserve funds. Historically, Newnan has maintained a conservative budgeting approach, often holding reserves at approximately 100-105%. However, recent financial reports indicate a significant shift in this trend.

City representatives revealed that the audited financials for 2023 showed a loss in reserves, with projections estimating an additional $2 million decrease in the current year. This decline is attributed to the city's commitment to infrastructure projects, specifically paving initiatives. As a result, the city anticipates ending 2024 with a fund balance of around 67%, a notable reduction from previous years.

Despite the decrease in reserves, officials emphasized the importance of maintaining a healthy fund balance, which allows the city to remain debt-free and respond effectively to emergencies, as demonstrated during the tornado in 2021. The discussions highlighted the balance between investing in community needs and maintaining financial stability, a topic that will likely continue to be a focal point in future meetings.