Difficult decisions are on the table for next year’s Carbondale budget
CARBONDALE, Colorado – Furloughs, pay cuts and possibly even staffing and service reductions are all on the table as Carbondale town officials grapple with a new revenue reality for next year.
General fund revenues are now estimated to be down 25 percent for the year compared to 2008, including a 19 percent drop in sales taxes, according to budget projections put together by Carbondale Town Manager Tom Baker and Finance Director Nancy Barnett.
While sales tax collections are expected to remain flat for 2010, other revenue sources related to the downturn in construction activity are likely to trend downward for at least another year.
“When we look at the trend chart, it is our belief that the local economy is re-setting to a ‘new normal,'” Baker said during a budget work session with the Carbondale Board of Trustees Tuesday night.
Projected revenue levels for the town in 2010 look very similar to what the town was taking in five years ago, he said.
“Based on a modest annual growth rate of 3 percent, it will take us until 2020 to get back to 2008 levels,” Baker said.
While the town has been able to adjust for 2009 by cutting operation/maintenance and capital expenses, the result is a lopsided percentage of the budget, nearly 70 percent, now being devoted to personnel.
“While this is being made to work for 2009, it is not a sustainable balance of expenditures going into a future where revenues are not increasing or only increasing modestly,” according to Baker and Barnett’s memo.
That means there needs to be a “structural adjustment” to the town budget beginning next year, which inevitably will impact personnel.
Baker presented trustees with variations of three different budget scenarios, designed to trim between $250,000 and $300,000 in personnel expenses for 2010.
Trustees agreed that up to 10 unpaid furlough days, either taken individually by town employees or collectively on certain, pre-determined days of the year when town hall would be closed, should be factored into next year’s budget.
That alone would trim about $100,000 from the personnel budget, Baker said, although exceptions would have to be made for police and any other emergency services.
Other budget-cutting measures trustees agreed should be included in the 2010 budget will be to:
• Suspend town matching contributions to the employee retirement program;
• Adjust hours for building department and affordable housing program workers until the workload returns;
• Across-the-board wage and salary adjustments, including department heads and the town manager; and,
• A reduction in service and hours in some departments, as determined by department managers.
Also in the mix, although considered to be a last resort, would be a reduction in town staff, meaning layoffs.
“I think it has to be on the table,” Mayor Michael Hassig said, adding that if the other cuts don’t bring the budget under control, or revenues go down even more than expected, staff cuts will be inevitable.
The town board will again meet to begin hammering out the details of the 2010 budget on Oct. 20.
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