Colorado Springs City Council is bracing itself for one hell of a nail-biting, penny-pinching ride. 'Tis the season.
City Manager Penny Culbreth-Graft soon will inform Council and the public exactly how much less money the city expects to have for the 2009 general fund budget, as compared to the 2008 budget.
Currently, Culbreth-Graft acknowledges only that the figure is in the "double digits" of millions. Vice Mayor Larry Small and City Councilwoman Jan Martin say it's rumored to be around $25 million, or about 10 percent of last year's budget of $237.2 million.
At the Aug. 25 informal City Council meeting, Culbreth-Graft will give an initial presentation and likely offer some preliminary ideas about what should be done. But first, she'll address a more immediate problem: Sales and use tax collections this year are down, throwing the 2008 budget off-target and leading to a predicted $6 million to $8 million shortfall.
Culbreth-Graft says she believes actions already taken, such as voluntary department cuts and a partial hiring freeze, will be enough to mend that gap.
"It isn't so much the latest sales tax numbers that we are concerned about," she writes in a recent e-mail. "[I]t's a much longer declining trend and use of one-time revenues last year."
Balancing the 2009 budget will be the first big test for Culbreth-Graft, who was hired by the city last year.
"Her financial expertise is one of her specific strengths," Martin says. "I think we're in good hands."
But make no mistake: Balancing the 2009 budget will mean cuts.
Council members interviewed for this story say they don't want public safety which accounted for 48 percent of the 2008 budget on the chopping block.
Councilman Scott Hente notes that outside of public safety, Council faces other constraints. The city has to fund parks and public works as required by the Pikes Peak Rural Transportation Authority and Trails, Open Space and Parks, respectively.
He's half-right. PPRTA does require the city to spend at least $18.1 million on transportation maintenance and $5.7 million on transit services each year. However, the city has spent progressively more in these areas since that rule was put in place in 2004. In 2007, for instance, it spent over $7 million more.
While TOPS doesn't have this sort of requirement, its maintenance funds can be used only for TOPS properties. So parks purchased outside of the system, such as Garden of the Gods, aren't eligible for any funding.
Last year, parks accounted for 8 percent of spending, while public works ate 14 percent. Combined with public safety, that's 70 percent of the 2008 budget. If all three areas are basically off-limits, City Council will have few places to snip a lot of money.
Some council members say the best answer is to spread the blow as evenly as they possibly can.
"We're going to have to find some way to distribute the cuts across the budget," Small says.
He also predicts many capital projects, especially for public works, will again be delayed. But the vice mayor says delaying projects only works for so long, because capital projects end up growing more expensive as they're put off.
Martin, Hente and Darryl Glenn say part of Council's answer may lie in department consolidations. But they agree that likely won't be enough to bridge the gap. Glenn says it's time to look at privatizing some services, or just plain eliminating them.
"We continue to be all things to all people, and we can't," Glenn says.
"I think you've heard me say in the past that, instead of inflicting death by a thousand wounds, I'd rather stop doing a few things," he says.
Of course, no councilor dares mentioning specifics just yet. But for his part, Hente says a couple years ago, he was against closing community centers; now, he'll look at everything but public safety with a critical eye.
Bad to worse?
Struggling with budget shortfalls has become a yearly ritual. This is partially because the city depends on sales tax, which means the more you buy, the more money the city has. That hasn't played well in the sour economy.
But if the author of the Taxpayer's Bill of Rights gets his way in November, past budget trouble will look like a cakewalk.
Douglas Bruce has two initiatives on the ballot this year aimed at destroying the Springs' Stormwater Enterprise, and injuring its enterprise system in general. If they pass, the city predicts it would lose more than $200 million over 10 years causing a predicted 17 percent reduction in services at full implementation.
Killing the Stormwater Enterprise (or, as Bruce calls it, "the rain tax") could have further financial implications. The city is federally mandated to maintain stormwater discharge, but without the enterprise it would lose its funding source. Noncompliance with the mandate could mean fines of up to $27,500 per day.