Vice Mayor Terry Turner has let Interim City Manager Terry Lewis know that he expects as many as 40 more city employees will have to be laid off, and further employee benefit cuts will be necessary, to make the city’s 2013 fiscal year budget balanced.
Turner made the point in an email he sent Lewis Feb. 6, more than three weeks before the City Commission’s first budget workshop of the year — Feb. 28.
Using “Ongoing Budget Crisis” as his subject line for the email, Turner explained that nothing was more critical for Lewis to grasp than the upcoming budget picture.
“I believe that the budget needs to be among your highest, if not your highest priority,” Lewis wrote. “City budget trends have been very unfavorable (even more unfavorable than at the county) and are likely to get much worse in 2013.”
Turner attached a spreadsheet that he used to explain the gravity of the problems.
In the email, Turner wrote, “You will note that we have reduced headcount by 24% (an average of nearly 37 people in each of the last five years).” Turner added, “I think it is extraordinarily unlikely that you will be able to present a balanced 2012-2013 budget which does not rely on another 30- to 40-person reduction in headcount.”
But that’s not the biggest problem, according to Turner.
“The fundamental problem is that the painful headcount reductions have been more than offset by increases in compensation per employee,” Turner wrote.
For example, Turner pointed out that salary and wages per employee had increased 19% over the past five years. Further, the total compensation per employee has increased 34% over the past five years.
“The biggest driver is pension cost, and as the most recent actuary reports make clear, the growth in employee pension costs will accelerate next year,” Turner wrote in his email.
With city revenues not expected to climb in the next budget cycle, and taxable property values predicted to fall at least another 5%, Turner noted that cutting the number of employees and reducing employee costs are the only ways the city can get ahead of expected shortfalls.
“I encourage you to engage the 2012 and 2013 budget challenges aggressively and as soon as possible,” Turner wrote Lewis.
The Sarasota City Commission will hold its first budget workshop at 3 p.m. Tuesday, Feb. 28, at City Hall, Commission Chambers, 1565 First St., Sarasota.