Glenwood looks to hold line on 2011 spending
GLENWOOD SPRINGS, Colorado – A range of mid-year spending adjustments helped the city of Glenwood Springs absorb what’s been a more than 5 percent decline in general fund sales taxes to date this year.
When the downward spiral didn’t show signs of reversing after the first few months of the year, the city responded by offering a 32-hour work week option for willing employees, leaving some vacant positions open for a period of time, and adjusting hours at the community center.
While revenues are still running below 2009 levels, so are expenses, city manager Jeff Hecksel noted during an Oct. 7 City Council work session to present the proposed 2011 city budget.
Hecksel also believes the worst of the free fall is behind us, noting that the sales tax numbers have begun to stabilize in recent months.
“We’re sort of bouncing along the bottom now, but we’re not getting worse at this point,” Hecksel said, adding that the proposed 2011 spending plan is based on what he believes to be conservative projections.
Still, some City Council members are wondering if a projected 5 percent increase in 2011 sales taxes over 2009 actuals is conservative enough.
“I am concerned that maybe we need to budget expenses based on what we’re seeing now,” Councilor Shelley Kaup said.
Mayor Bruce Christensen noted that the city would need to see a 10 percent turnaround in sales taxes in order to get back on track with this year’s projections.
He said the city may want to start looking at a list of possible service reductions now instead of waiting to see how the first few months of next year progress.
Glenwood has recorded 27 straight months of sales tax declines going back to mid-2008. However, while the year-over-year drops were registering between 5 and 9 percent through the first half of 2010, July and August returns came in at around 2 percent below the 2009 figure for those months.
“That doesn’t mean things can’t change,” Hecksel said. “But I feel comfortable with what’s being presented.”
Hecksel has recommended a $12.2 million general fund budget for 2011. That’s about $600,000 more than actual 2009 expenditures, but about $300,000 less than this year’s budget.
Some significant spending cuts are proposed for next year, especially in the street tax fund.
“This fund is not doing well, and we did have to make some cuts to bring it back into the black,” Hecksel said. Among those proposed cuts would be $205,000 in funding to support the Safe Routes to Schools program.
Beyond typical street maintenance, the only major spending from that fund next year would be to finish Donegan Road and pay for the city’s 10 percent share of the South Bridge Environmental Impact Statement.
Cuts would also impact the city’s South Glenwood bus route, and some Ride Glenwood hours may also be reduced, according to the budget proposal.
If worse comes to worse and sales taxes continue to decline next year, City Council has been asked to review a list of some $726,000 in general fund expenditures that could be cut. Those include such things as eliminating virtually all youth and adult recreation and athletic programs, reductions in community center hours and services, and cuts to the police and fire departments.
However, “Based on what we’re seeing now for 2011, those things do not need to be considered,” Hecksel said.
The other potential factor that was not included in the budget planning are the cuts that would be necessary if the tax-cutting Amendments 60 and 61 and Proposition 101 gain voter approval in the Nov. 2 election. That would mean another $1.5 million hit to the city budget next year alone, Hecksel said.
City Council will have a follow-up work session to discuss the 2011 budget on Oct. 21, beginning at 4:30 p.m. in the council chambers.
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