The Augusta Commission has tough budget choices ahead including whether to continue spending some $7.7 million on external agencies and how to reduce employee healthcare costs.
With city departments and elected officials starting work on the 2026 budget next week, Administrator Tameka Allen asked Augusta’s mayor and commission to consider the external agency funding as well as several questions about how taxpayer funds should be spent.
The city will begin the fiscal year in a hole Jan. 1 after having to use $11 million from reserves to cover a 2025 shortfall and the end of American Rescue Plan Act funding. Recovery from Hurricane Helene cost Augusta $65 million as of June 30, Interim Finance Director Timothy Schroer told the governing body Tuesday.
FEMA has reimbursed the city $35 million so far, and the city expects most of the rest to come in by year’s end, Schroer said.
Considerations carrying over from this year include rising employee healthcare costs that contributed more than $7 million to this year’s shortfall.
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Addressing the costs will take several years and may require increasing employee premiums, changing plans or other measures, Schroer said. Other adjustments will include covering a more fully-staffed sheriff’s office, he said.
Plans do not yet include paying a fine, earlier estimated at millions, to the IRS for Augusta improperly filing formers required by the Affordable Care Act. Schroer said Tuesday that city lawyers continue to work on appealing the fine.
Asked about Augusta’s financial position, Schroer said it is “good,” aside from the areas of concern he mentioned. The city typically ends the year spending about 98% of its budget, he said.
Augusta has about $800 million in pooled cash spread across multiple banks, he said. The largest chunk is in the state-sponsored Georgia Fund 1, which the city views as the safest and most liquid, he said.
Scrutiny on outside agencies
Allen presented the commission with lists of current allocations to external agencies. She said for the first time, the city is demanding performance metrics from them and verifying which payments are truly required by law or contract.
In the discretionary category includes funding to address the health and wellbeing of Augusta citizens, such as payments to Serenity Behavioral Health, Project Access, Lamar Medical Center, Miracle Making Ministries and Child Enrichment.
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The Department of Public Health is allocated $546,000 for mosquito control. MACH Academy receives about $215,000 for its youth tennis and afterschool programs.
Also under discretionary are the $218,670 allocated to the Lucy Craft Laney Museum and $143,670 paid to Augusta Museum of History this year. About $251,000 went to the Greater Augusta Arts Council for operations, regranting and the Arts in the Heart of Augusta festival.
The city also supplies funds to the Augusta Development Authority ($198,000), Augusta, Georgia Land Bank Authority ($139,990), the Downtown Development Authority ($264,740), the ACE Downtown program ($549,470) and Augusta Canal Authority, ($148,500.)
Payments to agencies such as the health department may be mandated by the state with amounts left to the city’s discretion. Georgia requires counties to pay a minimum of $1 for each resident to support regional commissions. Augusta pays $231,380 to the CSRA Regional Commission.
Augusta pays more than most
Augusta is unique in the levels of funding it supplies outside agencies, Allen said. Many cities and counties, including Columbia, fund only the minimum, she said.
“It’s not because they can’t, it’s because you have the concern about oversight,” she said.
Augusta should probably consider focusing on its own operations, she said.
“When you’re saying that you want to cut your internal operations that may affect the livelihood of people that work for this government, but you’re going to give money out of your house to somebody else’s house without taking care of your own house. It just doesn’t seem fair.”
Commissioner Jordan Johnson said he viewed the funding as partnerships to meet needs the city can’t address on its own, such as mental health.
Johnson said he couldn’t imagine Augusta cutting subsidies to the CSRA Alliance for Fort Gordon or the Junior Achievement Discovery Center and asked how the commission would decide who to cut.
“I don’t support pulling a single dime from the Augusta public library system,” he said. The system, for which Augusta funds about 76% of operations, receives $2.9 million in local dollars this year.
Commissioners Tanya Barnhill Turnley and Catherine Smith Rice said it may make them the bad guys, but lines have to be drawn.
“My question is if you have been getting city money for years, are we your only funding source?” Barnhill-Turnley asked. “We’ve got to get this whole ship righted.”
“We’re going to have to make some tough decisions and that’s what we’re up here to do,” Smith Rice said.
More budget questions
Allen said going into budget planning, she also needed direction on other questions, including whether to plan to increase taxes next year.
The commission has kept increases at a minimum by adopting the rollback millage rate for several years, including 2025. The city is well below its self-imposed tax cap, and could raise more revenue with an increase.
If the mayor and commission are considering across-the-board cuts, Allen asked whether these should include all departments, those led by elected officials, public safety and judicial personnel.
The commission might also consider whether to deny or allow funding for new departmental programs, and whether to eliminate subsidies for departments that don’t make money, such as Augusta Transit, Augusta Housing and Community Development and Richmond County Correctional Institution.
Transit and HCD rely heavily on federal grant funds but get city dollars for grant matches and operations. RCCI gets a state subsidy but it doesn’t cover the cost of housing the state’s prisoners.
Mayor Garnett Johnson said he’d called for a 5% across the board cut last year and asked that all departments model a 10% cut this year, “so we’re at least show the taxpayers that we’re working to try to find a solution outside of tax increases.”
