FARMINGTON -- The rapid expansion of a commercial base in this city has local leaders excited about the potential revenue stream, but also wary of doing too much, too fast.
City leaders held a two-hour work session recently to discuss the merits of a 10-year financial plan for the community developed by Econowest Associates Inc. That study, approved earlier this year by the city council, shows a pattern of growth that will result in more sales tax dollars, and reveals the need for more services in the near future.
It also shows that, despite a surge in sales tax spurred by Station Park, the city could be facing a deficit in five years if no other growth occurs and some current spending trends continue.
City Manager Dave Millheim, who has been a driving force behind the study, suggested Station Park is changing the dynamic for city leaders in terms of how much and how fast the city should grow.
The $250 million development is scheduled for completion by summer 2012.
"It does change the ball field, but we want to be really careful and not spend it and go crazy. I'm going to be recommending a careful approach," Millheim said.
Some of the major findings in the 38-page study include:
* The city's growth will be about 2.87 percent through fiscal year 2022, which will push up both revenue and expenditures.
* Sales tax revenues are expected to grow approximately 4.3 percent per year for the next decade, while wages and salaries are expected to increase by 4 percent through the same period. When an inflation rate of 1.8 percent is factored in, the population growth and inflation will drive expenditures over the decade.
* The combination of 3.34 percent in revenue gains per year and 4.24 percent in expenditure increases creates a growing imbalance after fiscal year 2016 of negative 1 percent to negative 9.1 percent by the 2022 fiscal year.
* Big issues facing future city leaders as far as growth and potential new expenditures include parks, police and fire coverage.
Mayor Scott Harbertson said the city has always been conservative in its approach to growth and spending and expects the study will provide local officials with the means to plan and adjust for the ups and downs of the next decade.
He said addressing growth for the fire and police department will be key for local leaders.
Still the mayor is optimistic.
"Farmington is in very good shape," Harbertson said of the city's growth and financial status.