“These reductions will impact services,” Roeder added. “What’s important is for the members of the council and the public to know where the reductions are to be made so you can make an educated decision.”
Last year, the city predicted it would have a $4.6-million deficit in this fiscal year’s budget, but as the economy continues to struggle, the city’s revenues continue to fall short of earlier expectations.
The city’s sales tax decreased by 7.1% when compared with last year’s numbers, which were down by about 14%. The city’s transient tax is also down by 15% when compared with the first six months of 2009, which was also down compared with the previous year. Funds from the sales and transient occupancy taxes account for the city’s main sources of revenues.
Staff is recommending the city cut is projected revenues by $7.1 million and cut expenditures by $2.4 million.
Roeder’s other recommendations are as follows:
Review the use of equipment replacement fund reserves to see if the city can access some of it.
Begin discussion with the employees association about wages and benefits.
Prepare a measure for the November 2010 ballot to increase the transient occupancy and business license taxes, although this would not affect this fiscal year’s budget.
And submit the entire city’s programs and services to the city council for budget prioritization.
City staff will follow up on these recommendations and take them back to the City Council for a vote later.