City grapples with budget

Posted 8/24/09

City staff continues struggling to establish a balanced budget for 2010 in light of the current tough economic climate predicted to leave Englewood …

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City grapples with budget

Posted

City staff continues struggling to establish a balanced budget for 2010 in light of the current tough economic climate predicted to leave Englewood with spending estimates of about $1 million more than predicted revenues.

City Manager Gary Sears presented three possible budget options at the Aug. 17 study session.

Sears said the goal is to have a proposed budget available by Sept. 15 and to provide all associated information to the members of the council in time for them to prepare for the Sept. 26 budget workshop.

Department directors join the members of the council for the workshop, in which details are discussed and the proposal for the 2010 recommended budget is made.

The workshop will begin at 9 a.m. and will be held in the community room on the second floor of the civic center and is open to the public

The city manager’s budget options presented Aug. 17 ranged from a hold-the-line scenario to the worst-case situation that would require laying off about 10 percent of city employees.

The issue is revenues. Because year-to-date tax collections are down almost $1.4 million compared to 2008, the city has imposed a number of cost-cutting measures, including a hold on filling most vacant positions, cutting back on equipment purchases and reviewing all proposed spending.

Sears told the council the declining revenues are expected to continue so the staff is recommending all those measures remain in place as they develop budget plans for 2010.

“We have realized some savings from the cost-cutting measures but we need to take other steps for next year’s budget,” the city manager said. “We did make progress as all three of the unions representing our employees have agreed to a wage freeze for 2010. They also agreed to the freeze on cashing out personal leave days at the end of the year.”

Cost cutting measures include delaying proposed projects like planned street pavings and possibly even eliminating special events like the Sound of Summer Concert Series and the Olde Tyme Fair.

However, even figuring in all those measures, the initial projections are that the cost of keeping the city running at the present level will exceed revenues by about $770,000, plus the city has to set aside about $300,000 as matching funds needed to accept a federal grant for hiring three police officers.

Sears’ priority one used all available steps to reduce spending plus requested a loan from the Long Term Asset Reserve of about $1 million to balance the budget.

The reserve fund is money from city assets such as the sale of McLellan Reservoir property and some of the proceeds from lease of city land to the Sheridan redevelopment project.

Sears also presented two other options in case the economy worsened and revenues dropped well below expectations.

Option two involved all the priority one cost-saving measures as well as more severe cuts, including closing the library and the municipal court one day a week as well as layoff of three full-time people. The savings which represent about a 5 percent budget reduction would reduce the requested loan from reserves to about $700,000, which includes the matching fund for the federal grant.

The third option presented includes the reductions in option one and two plus even more severe cuts including laying off about 40 employees. The total savings represent about a 10 percent spending reduction in 2010.

During the study session, the city council agreed the money needed to be earmarked for the matching funds necessary to accept the federal grant.

Councilmember Joe Jefferson said priority one is obviously the preferred option and other members of the council generally agreed.

District 2 Councilmember John Moore said he felt it was a place to start but noted he would like to look at ways to reduce the amount of money that must be taken from the Long Term Asset Reserves.

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