The city will likely need to dip into its reserve dollars to cover a $1 million shortfall next year, according to a preliminary 2013 budget.

The city is projecting a $1 million deficit for 2013. However, with its carryover money finishing the year at $4.6 million, it will be able to cover the shortfall and remain in a good position for 2014, Finance Director Mark Beckdahl said.

“We’re projecting to be in good shape by the end of the year,” he said. “I think that gives us some cushion against what you can see is difficult revenue numbers for 2013.”

Springfield City Manager Jim Bodenmiller and Beckdahl will present their preliminary 2013 budget to city commissioners at 6 p.m. today and Wednesday in the City Hall Forum conference room. A public hearing will be held at the Dec. 4 city commission meeting and a final budget will likely be voted on Dec. 18.

The rainy day money will make up more than 12 percent of general fund expenditures. The city typically aims for 10 percent. The balance has increased due to reduced spending, economic growth and improved income tax collections.

“Those things all rolled together gave us a pretty nice picture for the year,” Beckdahl said.

Income tax revenues increased by 5 percent in 2012 and will likely finish about $850,000 more than original budget projections.

The city is projecting a 3.5 percent revenue increase, or about $1 million, for 2013. The city generated a little more than $29.9 million in 2012, and expects to generate $30.9 million next year. Income tax revenues make up about 74 percent of the city’s general fund.

Although the city’s income tax revenue has increased, after the loss of shared state taxes, the city will see a loss of $1.5 million in total revenue from 2011.

They’re projecting revenue levels less than both 2006 and 2007. The city projects general fund revenue to be about $37.6 million, a slight decrease of the projected estimate.

While the budget will be balanced heading into 2013, city staff is concerned about growing its capital program. The loss of Local Government Funds and the estate tax will hamper the city’s ability to both maintain its buildings and neighborhood streets, Beckdahl said.

The city estimates it will have $3.4 million for its capital programs, of which $2.1 million will be used for debt service. A limited amount of paving is planned for 2013.

“We’ll be doing general repairs and maintenance, it’s just kind of a tough environment to do much beyond that,” Beckdahl said.

The city is still working to control expenditures heading into next year. It projects spending nearly 69 percent of the general fund on public safety and criminal justice.

The police division will be at 128 positions in 2013, compared to 131 in 2012 due to retirements and attrition. The minimum staffing required by the city charter is 124. The fire division is already at its minimum staffing required by the city charter for 2012 with 127 positions.

The airport, central stores, police levy and street maintenance funds will use a general fund subsidy of $1.75 million to balance them.

“We’d love to not have to subsidize those funds, but that’s just how it is at this point,” Beckdahl said.