Mayor Swearengin Presents Mid-Year Plan to Address Budget Shortfall
Mayor Ashley Swearengin today presented a combination of departmental reductions, labor concessions and citywide adjustments to address a $10.175 million shortfall in the fiscal year 2011 budget and keep the City on the path to long-term financial stability.
“We continue to have to make very difficult choices, but every step that we take is a step closer to long-term financial health for our city,” Mayor Swearengin said. “While the strategies that we’re proposing are difficult and very painful, they also are designed to have as little impact as possible on direct service to the public.”
Mayor Swearengin said the budget-balancing strategies for the remainder of the 2011 fiscal year focus on three main areas:
Almost $3.7 million in departmental reductions in fiscal year 2011. The savings include reductions in the Mayor and City Manager offices, Council offices, and the Police, Fire, PARCS, DARM, Public Works and Community Revitalization departments.
$3.3 million in concessions from the Fresno Police Officers Association. The city and FPOA already have agreed to $3 million in concessions. An additional $3,339,000 in concessions that would be realized over an 18-month period are under discussion.
$3.175 million in citywide adjustments including debt refinancing and payment deferrals, reductions in internal service fund charges, reductions in department legal services and savings in leave payoffs. Those reductions also include several department consolidations, including:
- Moving the Utility Billing and Collection Division from the Finance Public Utilities Department;
- Eliminating the General Services Department and Moving the Facilities and Fleets divisions to Public Works and the Purchasing and Central Printing divisions to Finance.
- Moving parks maintenance from the Parks, After School, Recreation & Community Services Department (PARCS) to the Public Works Department. Recreation and after school functions will remain in PARCS.
In addition, the FY 2011 full debt service for various Parks projects will be paid from impact fees rather than partial contribution of $800,000 from the General Fund. However, the proposed Eaton Plaza project will be postponed pending the recovery of the impact fees.
Between 35-40 city positions will be affected by the proposal; 29 of the positions currently are filled. Mayor Swearengin said no filled positions in the Police or Fire departments will be impacted.
A majority of the affected positions are in the City’s code enforcement division. The Swearengin administration is assessing its code enforcement effort compared to other cities and will make recommendations on a new approach that requires fewer resources during council’s upcoming budget workshops.
When annualized in fiscal year 2012, the above actions result in general fund reductions of $5.5 million in labor concessions, $6.59 million in department reductions, and $4.71million in citywide adjustments.
Mayor Swearengin earlier this year announced that the City faced a $12 million annual shortfall to close the current year budget deficit which included carry forward almost $2 million in order to be balanced in FY 2012. With savings that are anticipated in FY 2012, due largely to ongoing discussions with FPOA, the amount of FY 2011 mid-year cuts has been reduced to $10.1 million.
Mayor Swearengin said the shortfall in the fiscal year 2011 budget resulted from a number of factors, including $2 million less than anticipated in property tax; $1.5 million less than anticipated in sales tax; $1 million less in carryover from the fiscal year 2010 budget; $2.5 million in debt service for the Convention Center parking garage and $100,000 toward deficit fund recovery; and an anticipated increase in future expenses requiring reductions now to maintain fiscal stability in the future.
In preparing the mid-year reduction plan, Mayor Swearengin said key assumptions for the 18-month period include revenue from commercial solid waste franchising; labor concessions, including an additional $700,000 in concessions for other bargaining units in fiscal year 2012; no increases in salaries for City employees beyond current agreements; increases in development permit fees; and the sale of the Palm Lakes property.
Additionally, the current week-long furlough between Christmas and New Year’s will be extended through fiscal year 2012.
Council workshops on the proposal will be held on Oct. 28 and from Nov. 1-8 in Room 2165/Meeting Room A in City Hall. Final council action on the budget is scheduled for Nov. 18, and the final plan will be implemented on Jan. 1, 2011.
To view the powerpoint presentation about the mid-year budget update, click here.