Minutes 02/08/1972 - Laserfiche WebLink

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72-38 - "The City Council at its meeting on January 11, 1972, instructed me to review tb current General Fund Budget a~d study the posslbi2ity and feasibility of reducing it by $500,000. Conferences have been held over a two-week period with all Department Heads in a pains~ taking effort to seek logical means for reduction. As you were advised when the current budget was austere budget possible, containing little funds for and with no possibilities for a built-in surplus. adopted in June, 1971, it was the most contingencies or abnormal emergencies, As a result of my conferences with Department Heads, and a line-by-line re-evaluation of proposed appropriations, I see ~o way of reducing the budget without elimination of person~ nel and a corresponding reduction in public services. In our General Fund Budget, exclusive of funds appropriated for the School Budget, there was appropriated for general City operations a total of $16,228,828. As of December 31, 1971, a total of $8,387,762, or 51%, had been expended or encumbered, leaving a balance of $7,841,066 for operations during the final six months of the fiscal year. Of this remaining balance, it will require $4,077,622 for salaries and wages if employment and services are to be maintained at the present level. The $3,763,444 balance -- after salaries and wages -- reflects requirements for payment of $2,889,310 for fixed items, such as welfare, insurance, street lighting, hospitalization, retirements, Social Security pay- ments, and debt service. There are other fixed items such as jury fees, maintenance, agreements, rent of land and buildings, and automotive operations whose costs total $352,908. Because of their nature, there can be little, if any, reduction in cost or service elimination in these items. Funds in the Supplies and Material category as of December 31, 1971, totaled approximately $329,472, and cover such items as office supplies, construction and street repair materials, chemicals, recreational supplies, tools and restricted types of required employee wearing apparel. The balance left, after deduction of anticipated costs for the above outlined fixed items, supplies and material, is only $191,750. This must cover telephone service, data processing charges, lights, heat, water, radio maintenance, library books, and repairs to buildings and fire equipment. All.reasonable aclions have been taken to reduce expenditures except the reduction of full-time personnel and any drastic reduction or elimination of current services. We have placed a "hold order" on filling non-critical vacant positions, and all functions are on an absolutely necessary or emergency basis. We are currently operating with approximately 40 positions below authorized budgeted allocations and we are endeavoring to hold at this level, or lower if possible. During conferences held with the Department Heads, their current budRets were fully reviewed, seeking potential reductions. We have found only small, isolated items that might be eliminated and other planned programs, such as street repairs which, if eliminated, could create problems and prove more costly later. Even here, there were contingencies to be considered, such as possible snow storms. It is estimated, for example, that a major storm costs the City an additional $10,000, and even a minor one could run costs as high as $5,000. After careful and thorough consideration of all items, I do not believe we can realize, under the :austerity program already incorporated in the budget, any sizeable, reduction, such as the $500,000 suggested. Since December, we have taken extreme measures to hold down expenditures and with these controls, all departments will be held below their appropriations, except in cases of emergency. I believe the results primarily will be contingent on our meeting estimated revenues. Some revenue categories are sluggish-and may not reach estimates for 1971-72. A separate phase of our budget study deals with the School Budget, since education costs represent about 41% of our total budget. Dr. M. E. Alford, Superintendent of Schools, after reviewing the school budget, at my request, reported that whether or not expenses can be curtailed in areas which would permit meaningful relief depends on a number of factors. He noted, however, that the school administration will take the following steps, lng to effect economies for the remainder of the fiscal year: (1) Where possible, when vacancies occur, they will not be filled. e ndeavo!- (2) Where feasible, designated eligible items in the current operating budget may be capitalized. However, funds to defray the cost of such items must be appropriated by the City Council and the items must meet the criteria for capitalization as set forth in the Accounting Guide published by the State Department of Education. (3) Where possible, expenditures for selected replacement items will be delayed until the next fiscal year.