Preliminary city budget shows $3 million deficit

The city of Sarasota began its budget season Monday, and at the opening of the five-month process, staff projects a deficit of more than $3 million in the city’s general fund for fiscal year 2015.

The general fund is projected to take in roughly $56 million in revenue next year, boosted by a 4% increase in assessed property values. Revenue decreases elsewhere, including a $1.3 million decrease from the FY2014 budgeted income from red light cameras, hamper that increase.

In total, the general fund revenue figure falls short of the estimated $59 million in expenditures. That preliminary projection includes an “as-is” budget in several areas, assuming several figures remain constant from last year’s budget. Estimated expenditures will fluctuate over the forthcoming months as departments submit their individual budgets and possible salary increases take place.

The largest segment of the projected budget is personnel costs, which Finance Director John Lege said represents 80% of general fund expenditures. At a workshop Monday, he said this makes cutting elsewhere difficult — a large decrease in operating costs, which would represent a decreased level of service, can only go so far.

“Even with a 10% decrease in operating expenses, you’re only saving $1 million,” Lege said.

Within those personnel costs, the Sarasota Police Department represents the city’s largest expenditure.

Last year’s SPD budget of $29.45 million was more than half of the total general fund expenditures. City Manager Tom Barwin said a reduction in police staff has led to an increase in overtime hours as the SPD attempted to maintain its level of service.

“That’s going to be a challenging one to work through,” Barwin said. “Any thought of reducing our biggest expenditure has other spending implications.”

Another major expenditure that could change during the budget process is a subsidy to the city’s parking fund. Currently, the projected subsidy — used to prevent the parking fund from running a negative balance — is $544,000. With the State Street garage slated to open early next year, that cost could increase.

One of the options for helping to balance the budget included a reduction of that subsidy, regardless of whether a revenue source for the parking fund was found. Barwin warned against that option, speaking of his experience in a community that accrued a $10 million parking fund debt that limited its ability to spend.

“It's always better to do these things incrementally and not let these things get too far out of hand,” Barwin said.

Other suggested paths toward balancing the general fund included possible personnel adjustments, the use of up to $1.1 million in revenue stabilization funds and an increase in ad valorem taxes.

Contact David Conway at [email protected]