McMinnville board debates how to classify nonprofit appropriations; workshop proposed

Members of the McMinnville City Board of Mayor Vandermond discussed whether to recategorize nonprofit appropriations and how the city should distribute limited grant funding among economic-development organizations and charitable nonprofits.

The board examined the city—s policy, adopted in a recent ordinance, that sets nonprofit appropriations at 4% of estimated property tax revenue. Board members reviewed alternative approaches used by other municipalities, including placing economic-driving organizations such as Main Street McMinnville and the Chamber of Commerce in a distinct funding category or treating grants as reimbursements tied to documented expenditures.

"For the sake of the policy that we adopted, we held true to the way we had always done it, and that's what was reflected in that 4% property tax revenue," city staff said, referencing the ordinance passed "a couple months back." Staff described Cookeville—s model, where civic partnerships and charitable donations appear in the same 700-series section of the municipal chart of accounts and grants are often processed as reimbursements that require receipts and procurement compliance.

Board members noted the practical implications of changing classifications late in the budget cycle. Steve Harvey (Board member) asked whether recategorizing groups would alter the total pot of money available; staff replied that the 4% figure comes from estimated property tax revenue and could be changed only by amending policy or ordinance. Board members expressed concern about administrative burden if the city shifted to a reimbursement model: staff confirmed reimbursement would be more administratively intensive but feasible.

Several members proposed a workshop early in the next fiscal year to research alternatives and create clearer processes. "I think early on in this next fiscal year, we need to have just some kind of work shop, you know, do some research about, you know, Cookeville and some other municipalities," one board member said. Another board member agreed a workshop would be "a great idea," noting the deadline pressures for finalizing the current budget within two weeks.

No policy change or formal reclassification was adopted at the special call meeting. Staff and board members agreed the item is appropriate for deliberation in a future workshop and for consideration in the next budget cycle, rather than making a late change to the ordinance packet already scheduled for the regular meeting.