Sarasota city commissioners began budget deliberations Friday, July 6, with the knowledge that a deficit has been cut in half from $5.9 million to $3.3 million.
Because the city of Sarasota saw a slight uptick in property values — 0.88% — instead of an expected 4% decrease, city Finance Director Chris Lyons told commissioners staff could be more flexible when making cuts to achieve a balanced budget.
Despite the news, Lyons suggested the city use $1.7 million of its $3 million budget stabilization fund to balance the $178 million budget. The fund was created in 2008 to weather the plummeting property values and hasn’t been tapped yet.
Lewis and staff were also able to reduce the budget hole by making $1.2 million in expenditure cuts and making a $500,000 transfer of solid waste and self-insurance funds.
The proposed preliminary 2012-13 fiscal year budget calls for keeping the city’s property tax rate flat. Increases for taxpayers, though, come in the form of 4% water- and sewer-rate increases and increases in some building fees.
The budget, which includes $178 million in expenditures, also calls for more city-wide layoffs because almost 80% of the city’s budget involves personnel costs. As proposed, nine city jobs are offered up as suggested eliminations, including four layoffs in the building department.
If commissioners approve more layoffs, the city will have 585 employees, which is 192 fewer than the city had at its peak in 2007 with 777 employees. The budget also includes a proposed four-month hiring freeze.
Lyons noted that just more than half of general fund expenditures alone comes from the Sarasota Police Department.
“It is almost impossible to balance (the budget) without taking something from the police department,” Lyons said. “Everything else is relatively small, comparatively.”
Noting that the commission approved on first reading a revised police pension ordinance just a week earlier that will save the city at least $1 million a year, Commissioner Terry Turner said police changes are coming.
Pension costs city-wide, Lyons showed, have doubled from $7.6 million in 2008 to $14.5 million this coming fiscal year.
“We’ve got problems we are working through,” Turner said. “I think the vote on pensions was quite significant.”
The commission is scheduled to hold additional budget workshops at 8 a.m. July 17 to July 19, at City Hall.
Tough decisions are planned in the budget workshops next week.
For instance, keeping Lido Beach Pool and the Robert L. Taylor Center operational this past fiscal year cost the city more money than the facilities generated. It costs $161,000 to run the pool, but revenues are only expected to be $75,000. Lyons also said he expects the new community center to be $475,000 short of expected revenues in 2013.
The budget, though, provides $934,000 in operating funds for the community center and $161,000 for the pool to offset expected shortfalls in the coming year.
Commissioners will also review a variety of building-fee increases and other cost-saving measures in an attempt to eliminate the deficit.
• City-wide property valuations for the 2012-13 fiscal year increased .44%. When applying the 2011-12 millage rate of 2.9249 mills to this increased value, property tax revenues will increase $151,575 from the previous year.
• The budget reflects the utilization of $1,687,815 from the city’s $3 million revenue stabilization fund.
• The budget includes general fund revenue of $500,000, which was performed by a transfer of $250,000 from the Solid Waste Department and self-insurance funds.
• Provides for the elimination of 10.5 employment positions city-wide.