The IRS always wants their share

What started out as a way to provide low cost security for the former Alexander Human Development Center (HDC) property and give city employees a way to live in Alexander without a major cost to them, may be considered income by the Internal Revenue Service. The plan was first adopted when former Mayor Paul Mitchell was in office.

In 2022 the former HDC property was being vandalized after Pathfinders, Inc. moved to a new location outside Alexander. Pathfinders provided specialized services to those with physical and mental needs.

The cottages were used to house the patients. They are located in the southeast corner of the property along Highway 111.

With no one on the property at night, vandalism began to become an expensive problem. Mitchell decided it would be beneficial to allow city employees, who live outside Alexander, to live in the cottages in exchange for providing both security and keeping the grass mowed. At the time, no city employees lived in Alexander.

Those living in the cottages generally worked for either the street or police departments. This arrangement provided the extra advantage of having city employees nearby in case of emergencies.

In the past, City Attorney Chris Madison has expressed concerns that a low $100 per month will require the city to account for the remaining value of the rent as a fringe benefit on W2 forms. It will then be taxed by the IRS. Council members were told employees can be given two options.

1-They claim the fringe benefit at the end of the year on their W2.

2-The council sets a rent amount that is high enough to not require a fringe benefit report on W2s.

Madison told council members a fair market value needs to be established. Hiring someone to perform that task is the next step.

The other item under New Business at the Feb. 17 meeting;

The Alexander City Council adopted a resolution that finalized the dollar amounts on numerous line items in the 2025 budget. Below is a list of the estimated and actual revenue and expenses for 2025.

General Fund Budget

Estimated Revenue - $1,519,092.53

Actual Revenue -        $3,701,194.16

Estimated Expense - $1,612,131.53

Actual Expense -        $1,366,613.43

Street Department Budget

Estimated Revenue - $350,400.00

Actual Revenue -        $498,917.15

Estimated Expense - $323,200.00

Actual Expense -        $342,541.38

Parks Department Budget

Estimated Revenue - $297,800.00

Actual Revenue -        $228,518.21

Estimated Expense - $292,000.00

Actual Expense -        $154,752.58

Police Department Budget

Estimated Revenue - $1,061,730.00

Actual Revenue -        $912,943.65

Estimated Expense - $1,051,972.00

Actual Expense -        $911,659.65

Fire Department Budget

Estimated Revenue - $1,201,400.00

Actual Revenue -        $1,030,389.15

Estimated Expense - $1,195,900.43

Actual Expense -        $1,056,622.78

Payroll Fund Budget

Estimated Revenue - $2,235,517.00

Actual Revenue -        $1,794,595.00

Estimated Expense - $2,231,517.00

Actual Expense -        $1,765,111.86

In other news

Mayor Crystal Herrmann gave a brief report on the city’s permitting system. She noted there is no permit requirement for building a porch. Her fear is the porch will turn into a sun room with someone living in it.

Also, permits aren’t being posted. With the police department now taking over code enforcement, Herrmann wants the officers to be able to drive past a property and know any observed construction has been approved. With that in mind the mayor has proposed the city provide posting boxes to be used to display the permit on the property.

Next Meeting

The next meeting of the Alexander City Council is Monday, March 16, at 6:00 pm in the courtroom of the Alexander Municipal Complex (City Hall). Meetings are open to the public.

Amending the 2025 budget; Discussing cottage rent

There are only two items listed under New Business on the Alexander City Council’s next meeting agenda.

One is the amending of the 2025 budget. An annual occurrence to establish actual revenue and expenses for the previous fiscal year.

The second item is a discussion of how to handle the rent paid by employees who live in the cottages on the former Human Development property. There is still the question of how it will affect their income taxes.

The Alexander City Council will hold its next meeting on Tuesday, February 17. The regular Monday meeting is moved due to the Presidents’ Day Federal and State Holiday on the 16^th. The council meeting will begin at 6:00 PM. It will be held in the courtroom at the Alexander Municipal Complex (City Hall) on Highway 111.

I thought we did the hard part: New Master Development Plan on hold

OPINION/Editorial

When the last Alexander Planning Commission was created the main goals that needed to be accomplish at its inception was to establish new zoning regulations, a new zoning map and translate Saline County’s subdivision rules and regulations into a usable format for the city. We also needed a new master development plan.

The zoning and master plan Alexander had dated back to 1982. The city never had regulations for developers.

The new zoning, zoning map and development regulations were adopted by the city council in 2019. Then the planning commission set its sites on a new master development plan.

With the aid of Metroplan, the commission conducted an online survey and two public meetings. All designed to determine how local residents wanted Alexander to develop now and in the future.

Because the Pulaski County portion of Alexander gets its sewer service from the Little Rock Water Reclamation Authority (LRWRA), the city was required to not only write a new master plan but to have it approved by the LRWRA and the Little Rock Board of Directors. This requirement is in the 2018 contract between the two cities.

The plan began the approval process when it was submitted to the LRWRA in April, 2023. And, there it sits.

LRWRA officials couldn’t decide how to approve the plan in writing. When Alexander’s attorney stepped up in late 2023, it was decided to write a new contract, omitting the requirements for new zoning and a master plan. Simple right. Wrong.

Alexander’s attorney says the contract, in its current form, leaves open questions that should be spelled out in more detail. Approaching three years, the new contract is still being rewritten.

In the old days lawyers were paid by the word. Now they get paid by the hour. Makes me wonder.

At the January 20 council meeting Mayor Crystal Herrmann reported that both City Attorney Chris Madison and the attorney for the Little Rock Water Reclamation Authority are still meeting to write a new contract. There is no estimate as to a completion timeline.

So, if you were wondering what happened to the master development plan, you didn’t miss anything. It’s still sitting in someone’s drawer in Little Rock waiting for final approval.