[Update: I ended up reworking this a little, since the MFT-electricity thing is moot.]
The proposed FY2010 city budget includes not only the FY2009 budgeted amounts but also the final revenue and spending projections for the current budget year. One of the projected General Fund revenue numbers (p. 29) is truly shocking: sales tax revenues are now projected to come in at $375,700 less than the original budgeted amount. Licenses & permits look to be down $89,000 and property taxes come in at $78,000 under the original estimate.
The city is still claiming an $800,000 “surplus” for FY2009. Whatever you want to call it, some red ink was avoided mostly through hiring freeze and attrition, which cut wage estimates by $536,400 and reduced projected personnel expenditures overall by $694,010. Other major reductions occurred in contractual services, including deep cuts to training budgets.
It will be interesting to see how Council will respond to continuing financial challenges in FY2010. The financial consultant’s (Executive Partners) report is now available and contains both short- and long-term remedies for our chronic budget problems. A list called “Where to Begin” suggests the following priorities:
1. In this economic time, freeze employees wages for 1 year as the City is already considering.
2. Stop the post retirement healthcare immediately for new retirees and phase out for existing retirees.
3. Hire an Economic Development Director to create a proactive business-friendly economic development approach.
4A. Hire a Chief Financial Officer to manage the financial circumstances of the City and help Council and staff with the financial implications of their decisions.
4B. Hire a Purchasing Manager (reporting to the CFO) and centralize the purchasing function. Provide a savings target to be achieved or exceeded.
5. Raise the electric utility tax.
6. Conduct a thorough services review identifying core and non-core services, services that can be eliminated, services where level of service can be reduced, and services where pay for service opportunities can be instituted.
7. Implement the staff productivity, outsourcing, reorganizations, and reductions identified in the specific
departmental recommendations chart – Chart A.
8. Purchase excess liability coverage to protect the City against unforeseen claims.
9. Restructure the medical benefits as outlined in this report. Increase employee contributions to medical and pension plans.
10.Over time (3-4 years), raise the tax levy slightly to manage general fund needs and restructure the union
contracts to create consistency as outlined in this report.
Some of us called for a wage freeze last year; better late to the party than never but one wonders how they are going to get the unions back to the table for something like this. The Financial Advisory Committee (FAC) should feel vindicated in several areas such as the union contract restructuring suggestion being echoed here, one several great ideas from FAC (and BTW one I adopted to campaign on).