Provo City Council Chair George Stewart challenged Mayor Billings' proposed $1 million market-rate loan for iProvo, during the council's work meeting Tuesday (May 8, 2007).

"We need to remember that mayor's proposed budget is just that," Stewart said. "Setting the budget is the council's responsibility and it is our responsibility to pass a responsible budget."

While Provo is experiencing a cycle of high revenue, Stewart warned council members about an economic downturn in the future and suggested paying current iProvo debts while the city has the money to do so.

"We should face the brutal facts of our reality," Stewart said. "We should face the reality that we have a deficit. We should pay off current debts with current revenues instead of funding this project."

While emphasizing the benefits the city receives from iProvo, including lower competitor rates, Stewart argued that the current proposal was "too aggressive given iProvo's current net weekly install rate."

The mayor's budget projects 60 installs a week, a 47.5 percent increase from last year's rate.

"As a CEO, I wouldn't do this," Stewart said. "I always like to under-promise and over-deliver. It is going to be really hard to over-deliver on this budget."

Billings, who was present at the meeting, responded by saying that he was willing to negotiate with the council and would be open to an alternative route, but that he did not want to lower the expectations for the network.

"I don't want to set a budget with the assumption that we won't see an increase [in iProvo installs]," Billings said. "The one flaw that has been presented here today is that we cannot increase sales."

The current budget is based on 60 iProvo installs a week. The same quota was set last year last year, but only an average of 40 were installed each week, said iProvo Manager Kevin Garlick.

Stewart said that he would be willing to consider basing the budget on a rate of 40 installs a week, but that he thought that was even an aggressive number considering the previous quarter showed a weekly install rate of 20.5.

While Billings and Garlick believed that the low winter rates would increase substantially during the summer months, Stewart and some of the council members were hesitant to base the budget on such optimism.

"[This proposal] just adds to the burden of the next mayor and the next council and I don't think it's fair," Stewart said.

The council is currently working on an alternative 5-year budget for iProvo, which could borrow money from the general or enterprise fund to pay off the debt.

Copyright Brigham Young University 9 May 2007