Revenue Down, Steep Cuts Projected For Next City Budget

By Harry Saltzgaver
Executive Editor

The city’s revenues are lagging far behind projections so far this fiscal year, leading to predictions of even more budget cuts next year.

The good news, according to City Manager Pat West, is that all of the city’s departments are reducing spending. That includes the Police Department, where a shortfall of up to $6 million had been expected due to overtime spending.

Less than a month after the City Council had passed the fiscal 2008 budget last fall, and weeks after becoming city manager, West sent out a memo seeking an additional $5 million in spending reductions spread across all the city departments. That edict was fulfilled through hiring freezes and other savings.

“The departments are doing a wonderful job with their expenditures,” West said this week. “We started out with those cuts because of the police department shortfall.

“But (Police Chief) Tony Batts and his department are doing a wonderful job controlling costs. Now it looks like the pd is going to make it (budget). That’s a good thing, because we’re going to need the savings to offset the shortfall in revenues.”

West said both property and sales taxes, two primary revenue sources for the city, are far off projections. A shortfall of $3.5 million to $4 million currently is being projected, and that could get worse if the economy continues to slow down.

While this year has been bad, next year could be worse for many city services, West warned. This is the most expensive year of a mid-contract incentive package won by the Police Officers Association in October 2006. That deal will add $6 million more to the annual cost of maintaining the current force,

“We’re in the process of putting the budget together now,” West said. “I think you’re going to see significant cuts. In addition to the $6 million more from the police contract, we’re negotiating new contracts with fire and the miscellaneous employees. Plus we’re going to have to structurally fix the police overtime issue. We’re not sure what we’re going to need, but it’s going to be more than $6 million.”

Due to reforms passed in last year’s special election, the budget preparation process has been accelerated. The mayor now will have two months with the city manager’s proposed budget before presenting recommendations to the City Council and the public in the first week in August.

The City Council’s Budget Oversight Committee spoke Tuesday of upcoming budget challenges, but only in general terms.