City prepares for cuts if sales tax fails

Springfield City Manager Greg Burris on Tuesday presented two bleak pictures for the city's finances should a proposed 1-cent sales tax on the Feb. 4 ballot fail.

The sales tax is among the city's proposals to fund the Police and Fire pension plan, which is underfunded by nearly $200 million.

Burris' first presentation was the most pessimistic; it assumed that, in addition to the failure of the 1-cent proposal, overall sales tax revenue would drop by 1.5 percent in the current fiscal year and by another 1.5 percent in fiscal 2010.

That decrease, plus the additional $530,000 the city would need to make the full actuarial-recommended contribution to the pension plan, would mean $5.7 million in cuts to the city's general revenue fund budget. Those reductions would be on top of $5.2 million in cuts made to the current year's budget.

Among the recommended reductions:

• A hiring freeze for 30 open job positions, in addition to the 36 full-time general fund positions that are already frozen;

• A total reduction in transfers to the parks, health and transportation departments of $1 million, on top of the nearly $1.9 million cut from the fiscal 2009 budget;

• Elimination of all contributions to nonprofits and charities, saving the city nearly $600,000; and

• Suspending merit step pay increases for all current employees, saving $1.1 million.

The second presentation was slightly more optimistic; it was based on a failed sales tax proposal but overall sales tax revenue growth of 0.75 percent both this year and next. That plan would still require nearly $4 million in cuts - the main differences would be reinstatement of the merit pay increases and smaller reductions in payments to parks, health and transportation.

Burris said that while he obviously is not happy to make the recommendations, it is a necessary step and a response to citizen inquiries about what would happen if the proposed sales tax doesn't pass.

"The things that I'm recommending are difficult; they're uncomfortable; but they're something that is necessary for us to consider," Burris told the council.

See SBJ's Jan. 12 issue for more on the city's budget scenarios.[[In-content Ad]]