June 13, 2023

Revenue exceeded expenses for the city of Sioux Falls last year, and city officials are bringing a proposal on how to spend some of the excess.

The City Council will vote on an $11.8 million supplemental to its 2023 budget, using much of the $17.8 million fund balance left at the end of 2022.

The other $6 million was split between $3 million returning to the general reserve fund and $3 million being used to support increased construction costs for the Sixth Street bridge downtown.

The fund balance is “similar to last year – a very sizable amount –and not what we typically would see,” director of finance Shawn Pritchett said. “Sales tax is certainly not growing as quickly as it has.”

The supplemental also will account for recently announced donations to the parks system, including up to $1.75 million from Lloyd Cos. to support construction of both the Lloyd Landing in the next phase of the River Greenway and the new Pawsible Park at Jacobson Plaza, as well as up to $1.75 million from Denny Sanford to help construct a splash park at Jacobson Plaza.

Jacobson Plaza, which now will be fully built at once instead of in phases, has an estimated $16.5 million cost and will be split between the city and private donations – led by Garry and Dianne Jacobson. The supplemental includes an additional $3 million in city funding.

“We wanted to do as much as we could in one phase, so we didn’t have multiphase and construction disruption and so we had economics of scale,” director of parks and recreation Don Kearney said, adding the site at Falls Park West also requires excavation and decontamination, which means extra cost and more efficiency if it’s all done at once.

The hope is to have the plaza done by late 2024 or early 2025.

The supplemental budget also includes $3.5 million to support construction at 85th Street and Tallgrass Avenue, which will align with the future interstate interchange in the area as well as the construction of Veterans Parkway.

“The next section of Veterans Parkway is from Louise to I-29, and when that’s under construction, a lot of industrial traffic at the Tea exit will have to route up here, so we wanted to make sure a year in advance we got the intersection done,” director of public works Mark Cotter said. “It’s one piece in a several-piece puzzle of building out the infrastructure in the area.”

The plan is to bid the grading and utilities this year and include paving if it can fit in the budget, with a goal of having it done by the end of the next construction season.

The plan for construction of the replacement clubhouse and cart storage building at Elmwood Golf Course also could start construction yet this year as it’s proposed as a $3.5 million budget supplement instead of in a future bond where it was going to be included along with swimming pool improvements.

The cart barn burned down in 2019, and the current clubhouse dates back to the 1960s. A new building already is in design.

“It’s a very dated facility, and it’s been talked about for years, and we haven’t been able to do it, so this allows us to do it and pay for it and take it out of the quality-of-life bond,” Kearney said.

The clubhouse also is a project that will drive revenue, he said. The plan is to include banquet space, a kitchen, pro shop, offices, storage and restrooms, as well as outdoor seating.

“We have 27 holes (at Elmwood), so doing tournaments requires more space,” Kearney said. “They’re doing a lot of nongolf business for events and graduations.”

Because the city’s overall golf course performance has resulted in excess operating dollars, $600,000 from that fund balance will complement the sales tax revenue being used to pay for the project.

The supplemental also includes an additional $500,000 for an alarm system that will support Sioux Falls Fire Rescue as part of a systemwide upgrade to add more locations and functionality. Pricing for the equipment and installation has increased, driving the needed additional budget.

“The current system is operating on old operating systems that are no longer supported for upgrades, so this will upgrade the entire system to a better system,” Pritchett said.

Finally, city officials are asking for $1.25 million to bolster its opportune land acquisition fund. It will bring the fund, which is used to purchase land for things such as future fire stations, police report-to-work locations and parks, to about $2.6 million.

“We have a strategic land acquisition team that’s been meeting for the better part of a year to coordinate on land acquisition needs,” Pritchett said. “We want to get ahead of development and identify some of the key properties for the city.”

The City Council is scheduled to vote on the supplemental appropriation June 20.

Lloyd Cos. announces gift to support Downtown River Greenway project