Mineral Wells City Hall

The city's 4B Economic Development fund is projected to add $307,500 this fiscal year and total nearly $1.6 million in cash on hand after anticipated expenses.

The separate, self-sustaining fund's board of directors Monday unanimously approved its revenue and spending budget for the 2019-2020 year.

Finance Director said the fund should take in about $285,000 in sales tax revenue this year and add about another $22,500 in interest revenue.

"We are building a war chest because of the (Baker Hotel project) delay," said director George Gault.

"Overall I think it's in good shape," said Mineral Wells Finance Director John Moran, who presented the budget proposal. "I wish it would have built up more quickly. We are really concentrating on building that fund balance."

The economic development was created five years ago after city voters overwhelmingly approved a local option referendum to divert one-eighth of a cent of the city's sales tax collections to the fund, pledging to provide up to $4 million in public support to the estimated $65 million hotel restoration project. But 4B monies can also be used for other projects that have an economic development purpose as outlined by state law.

The fund's 2019-2020 budget lists $116,500 in expenses this year – but that is somewhat unlikely, Moran said. In 2017-18, just $2,712 in 4B funds was spent, and expenses in the current 2018-19 year will total about $6,050.

Moran explained that each year he has budgeted anticipated expenses of $75,000 for legal and professional services costs incurred when the fund and corporation were created. However, he said the city has never been billed for those expenses. Moran said this might be the last year he budgets those items if the city is not asked for payment.

Corporation director Mayor Christopher Perricone asked if unspent monies form the 4B go to the general fund. Moran explained those monies are from the 4B revenue account and remain there. They would simply shift to the fund's balance.

A likely expense from the fund this fiscal year is a $35,000 transfer to the city's general fund for what is anticipated to be half the salary cost of a new Main Street director. The Mineral Wells Area Chamber of Commerce has pledged another $30,000-$35,000 toward a director's salary.

The city has completed its application to the Texas Historic Commission and Texas Main Street Program to become a Main Street program. Moran said he believes the city submitted a "strong" application and anticipates an announcement in October.

If the city becomes a Main Street program, it will have until the first of the year to hire a director, with an annual salary of about $75,000, officials have said.

"My prediction is we are going to be accepted as a Main Street city," Moran said.

No sales of bonds are monies are anticipated for the Baker Hotel project this year. As Gault reiterated, the city's financial support of the project will be "the last dollars in" the project.

The project's first phase is expected to begin by next month with an approximately one-year remediation to remove asbestos, lead paint and other caustic materials from the historic 90-year old building.

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