Bring the pain: 2010 budget process begins
The Lakewood City Council Finance Committee met on Monday evening to discuss the first steps in the 2010 municipal budget process.
According to Councilperson Kevin Butler (Ward 1), the city will face an estimated $2.1 million budget shortfall in 2010. Mayor Edward O. FitzGerald said he has identified around $400,000 to $600,000 in cuts, but must find another $1.25 to $1.5 million in reductions.
Mayor FitzGerald believes approximately 14 city positions will be eliminated in 2010. “They’re not all lay-offs. Most of them are by attrition,” he said. In the interest of being “careful,” the mayor declined to provide specifics regarding what departments would be affected. He vaguely alluded to a potential technology efficiency that would enable some of the cuts.
Unlike 2008 and 2009, when he felt he was able to slice a lot of fat from the budget without proportionally slashing city services, Mayor FitzGerald said the city is essentially now in a position where further cuts will directly translate to a decrease in city services. “We’re just getting to that point, I think” he said, adding he’d be “surprised” if anyone could find any more fat to trim.
Finance Committee Chairperson Michael Summers (Ward 3), who agreed with the mayor’s assessment, provided a pie chart depicting the city’s 2009 general fund expense areas and pondered where the budget could be slashed in 2010. Taking into account the massive funding hits Human Services has taken over the last couple of budget cycles, Summers declared them off limits. “You’re looking [next] at general government, public safety and public works,” he said.
Summers favored taking a “top down” approach to the 2010 budget process in an effort to “hold the line” and maintain what he described as a “right-sized” government. He put forth four different approaches to the situation ranging from covering the budget shortfall with the city’s approximate $1.5 million reserve fund to leaving the reserve fund alone and instead passing a structurally unbalanced budget.
The general sentiment in the room, including that of Summers, was that the city should avoid dipping into the reserve fund. Mayor FitzGerald emphasized it would be “crazy” to drain the reserve fund, especially in anticipation of 2011, when the city is obligated to make a $650,000 payment to the police and fire pension funds.
Councilperson Butler tossed out a fifth option for consideration. He suggested that the city should “overcut” in 2010 to avoid even more cuts in 2011 and to “put an end to the turmoil in city hall.”
Mayor FitzGerald offered a sixth option. If the city is forced to pare back vital services — like the fire department, he said, it ought to consider raising revenue, presumably through a tax increase. FitzGerald said he is not currently considering a tax increase.
In other finance-related news:
The city’s tax amnesty program has netted about $500,000 so far. A finance department representative said state funding to the city will decrease in 2010 by 17%, or $655,000.
Mayor FitzGerald said union contract negotiations are on schedule.
On Nov. 15th the finance director will provide city council with a rough estimate of the city’s expected expenses for 2010.
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