Well, not so new, but I’ve been keeping it on the down-low. I’m the Assistant Budget Director for the City of Durham.
Bonfield’s budget request cuts 3.1%
By Ray Gronberg : The Herald-Sun
May 19, 2009
DURHAM — City Manager Tom Bonfield’s fiscal 2009-10 budget request cuts overall spending by 3.1 percent, with most of the cuts targeting the parts of city government funded by property taxes.
As directed by the City Council, the request holds the line on Durham’s property tax rate, keeping it at 54 cents per $100 of assessed value.
Bonfield’s proposal would slash overall spending to $344.4 million, about $11.1 million below what the council authorized last year in the closing months of former City Manager Patrick Baker’s tenure.
All but about $1.8 million of that comes from the city’s tax-fortified “general fund,” which pays for most of its day-to-day operations aside from those of the Water Management Department and the Durham Area Transit Authority.
Much of the savings comes from a proposed staffing cut that would do away with 113 of the 2,425 city jobs the 2008-09 budget authorized. A majority of the targeted jobs are vacant, but 35 workers will have to find new positions on the city payroll or face being laid off.
The job cuts by themselves will save nearly $6.6 million and roll back nearly two years’ worth of growth in city staffing. The reduction in general-fund spending is the city’s first since 1996.
The proposed cuts come because revenues are lagging because of the recession at a time when the city has to raise spending for long-promised initiatives like the Holton Career and Resource Center and the Walltown Recreation Center. Those two projects by themselves are adding $816,258 to the budget.
Bonfield also acknowledged that the city was unable this year to draw money from its savings to help balance its spending plan.
The City Council last year told Baker and his staff to allow savings levels to drop below a key benchmark, 12 percent of annual appropriations, so it could cap the 2008-09 tax rate at 54 cents per $100 of assessed value.
The 12 percent mark is supposed to assure banks and credit watchdogs agencies that Durham can repay its debts and merits a AAA bond rating. Waiving it was the single most controversial decision the council made in the 2008-09 budget debate and led to a split, 4-3 vote on passage of that spending plan.
The resulting $4.5 million dip into savings “basically used up any surplus that was available” to help in the upcoming fiscal year, Bonfield said.
Spending cuts and somewhat better-than-expected revenue collections have the city’s fiscal 2008-09 general fund running $1.4 million in the black. Bonfield is not, however, proposing that the city spend that money on continuing expenses like salaries.
Instead, he said officials should use it only on one-time moves like pushing savings back up to the 12-percent level, dealing with a $2 million deficit in DATA’s operating fund, and catching up with deferred maintenance.
Applying it to day-to-day expenses is a bad idea because the city faces continued “economic uncertainties,” Bonfield said.
He added that it’s not clear the state and local economy has hit bottom.
Even if it has, “I don’t think any of us know how long we’re going to stay where we are,” he said. “And staying even is not a great option. Things need to get better, or we will probably have more unpleasant discussions going forward.”
The budget cuts won’t require the elimination of programs, but the city will have to scale some back. It won’t accept new applications for streetlight and traffic-calming installations, and will cut operating hours at some recreation centers.
Bonfield’s spending request also assumes that the Solid Waste Management Department goes with the planned cancellation of a privatized weekly curbside-recycling contract and moves to handle those pickups with its own laborers every other week.
That change is also tied to plans to end city-provided pickups of business and apartment-complex Dumpsters. The changes at Solid Waste Management all told will save $434,000 a year, officials said.
They remain on track even though the current recycling contractor, Tidewater Fibre Corp. is trying to head off the cancellation of its deal. It’s made a counteroffer, but its terms don’t seem likely to save as much money as Solid Waste Management Director Donald Long’s plan, Bonfield said.