This week has brought more bad news for City Council.
As reported in last week's Independent, the city's $16.8 million budget shortfall is expanding. Chief financial officer Terri Velasquez says current projections pin it at nearly $20 million. That's based on December 2008 sales tax collections that plummeted nearly 16 percent from December 2007. In addition to enlarging the real shortfall in 2008 by about $500,000, the new numbers have played havoc with models used to predict 2009 sales tax collections, leading to lower estimates.
But the city wasn't ready to face the music Monday. Not even close.
For starters, City Manager Penny Culbreth-Graft suggested Council ignore that extra $3 million for now, and take a second read of the volatile market come mid-year. By then, the city will have calculated the effects of several big-box stores closing, as well as the addition of troops at Fort Carson.
Her suggestion ticked off several councilors.
"We can't operate the city without a baseline budget," Vice Mayor Larry Small said.
But the city manager said finding a baseline has been challenging.
"What's happening with the economy has never happened in our lifetimes," she said. "Every time we get a new month or model, projections change."
In the meantime, she said, Council could consider approving her plan to cut 14.5 percent from all departments except public safety, which it already dealt a 1 percent blow.
But as of Monday, Council wasn't even ready to tackle the original $16.8 million problem. Instead, it scheduled a meeting for Tuesday, Feb. 17, to accept public comment, with final decisions coming Feb. 24. The decision was fueled partly by feelings of responsibility to citizens, but also by several councilors who wanted to "go on record" opposing certain cuts.
One thing's for sure: Waiting isn't fixing anything. In fact, Culbreth-Graft says, every 30 days that pass without action worsen the shortfall by $1.4 million.
Jan Martin and Tom Gallagher are the most vocal of councilors who feel that once the public speaks, it's time to make a big cut and move on. Gallagher says the city should slash 20 percent of its budget, then look to the community and private-public partnerships to try replacing what's lost.
"It's the one silver lining we've got over us right now," he says. "We don't have any money, so we have to do business differently."
Council has already agreed to plug part of the hole with one-time money and added revenues. The city's transit system, however, is still staring down a nightmare, since it's also losing money from the financially troubled Pikes Peak Rural Transportation Authority.
Then there's the fact that transit both creates money and spends money, which means that you have to cut a lot of bus routes to realize significant savings. The city, according to the transit department, will need to ax nearly $1.2 million to net a savings of $561,527, because of lost revenue on eliminated routes.
All this means transit could be cut by one-third, losing approximately 500 fixed-route trips per day, and service to 125 disabled customers. But the Front Range Express service to Denver, apparently, will be spared.
Users of the city's parks and recreation services will face increased fees, closure of Starsmore Discovery Center and Helen Hunt Falls Visitor Center, and cuts at the Pioneers Museum.