TROY – Citing a phantom budget deficit that’s frequently projected but never realized, Troy’s mayor recently vetoed an increase in city employee retirement benefits.

After the council voted 4-2 at its June 12 meeting to increase retirement benefits (LAGERS) at the cost of about $500,000, Mayor Ron Sconce announced last week he would veto the ordinance.

In a statement released last week to employees obtained by The Lincoln County Journal, a city official cited a forecasted budget deficit as the reason for Sconce’s veto.

“This year’s budget deficit before the LAGERS change was $716,850.62, with the additional cost …the city’s budget deficit will increase to $994,000,” Human Resources Generalist Kaitlyn Knickmeyer stated, adding that at current spending levels, the general fund reserve would be depleted by 2031.

However, a review of Troy’s previous budgets indicates while a projected $994,000 deficit is the largest forecasted, previous predicted deficits have never been realized while in fact, surpluses have been generated.

The Journal reviewed Troy’s five previous budgets, dating back to 2020-2021. All five forecasted significant deficits in the general fund, ranging from as little as $618,000 in 2024-25, to as much as $826,000 in 2023-2024.

Another similarity between the five budgets is despite those forecasted deficits, a surplus was actually created by the end of the year.

Most recently, the 2024-25 budget forecasted a $618,000 general fund decrease to $5.36 million. Instead, it is projected to increase from $5.98 to $6.23 million.

The largest variance recorded came in the 2020-2021 budget, when a $641K deficit was projected to decrease general fund reserves to just more than $4M. Instead, at the end of the year, the reserve fund actually increased nearly $800K to $5.4M.

In 2021-22, the budget forecasted a decrease again of the general reserves from $5.4M to $4.7M. Instead, it increased to $5.79 million, more than a $1M variance.

Over the course of five fiscal years (2020-21, 21-22, 22-23, 23-24 and 24-25), Troy’s budgets collectively projected more than $3.5 million in general fund deficit spending. Instead, the general fund increased $1.5 million, from $4.7 to a projected $6.23 million at the end of June 2025.

Overall, while the general reserves grew, the city’s overall reserves have remained stable despite similar significant projected budget deficits.

Starting with the 2021-22 budget, the city was forecasted to decrease reserves overall by more than $26 million. Instead, after increasing from $17.87-21.35 million in 2024, overall reserves are expected to decrease to $17.65 this year. That $200K decrease in four years represents less than 1 percent of projected deficit spending over the same time period.

While the increase in retirement benefits remains effective, the board of aldermen can override if a second vote on the measure remains the same as the first.

Aldermen Quentin Laws, Rachel Dunard, Dennis Detert and Terri Huffmon supported the increase at the June 12 meeting, and four votes is all that’s needed to override Sconce’s veto.

Aldermen Harold Horner and Mitchell Bryant both voted against the increase, citing the cost to the city.

The board is expected to meet Monday, June 30 at 5:30 p.m. to vote on the budget and the major’s veto.