POULSBO — After cutting staff by 10 percent the City of Poulsbo still faces a shortfall of more than $228,000 in 2011, according to a preliminary proposed budget released Wednesday.
City leaders must now reexamine various service contracts and department budgets in search of savings.
“Those are pretty much going to be a drop in the bucket, but anything helps,” said city Finance Director Debbie Booher.
Poulsbo Mayor Becky Erickson hopes no more than $150,000 in revenue stabilization will be used to shore up the budget, leaving reserves at about $1 million, she said. Last year $400,000 was taken from reserves to balance the budget.
“I really am certain this will be the last year we have to do it,” she said.
Options to decrease the deficit include a tax on cars within city limits, an idea the city’s Finance Committee previously shelved, or a 10-day per year staff furlough.
Finance committee members suggested a final $40,000 debt payment for the Marine Science Center be at least partially absorbed by the Marine Science Center Foundation.
The city maintains its status as a Tree City USA with a forestry program budgeted at $2 per city resident. Councilwoman Connie Lord said forfeiting the city’s Tree City status could be a savings option.
“That’s another thing we need to weigh for the general well-being of the community,” she said.
Department heads will be asked to review costs that could be postponed one year, such as attendance at conferences.
Councilman Jeff Bauman said he was surprised how few discretionary items remain.
“I guess I was just expecting an easier go of it,” Bauman said.
Operating revenues for 2011 are projected at 2.5 percent below 2010 levels. Decreased revenues include a 21 percent reduction in fines and forfeitures, which mainly come from traffic infractions.
Councilman Dale Rudolph said that reduction should be examined.
“Are people behaving better than they used to or are we enforcing less than we used to?” he asked. “If we’re not having crime, than what are our police doing? It’s a question that has to be asked.”
A $1.3 million shortfall was predicted earlier this year, but was reduced through staffing cuts, an increase to utility tax revenue and adjustments to various fund transfers.
Thirteen employees opted for a Voluntary Separation Program, which gave them increased severance to willingly leave their jobs. Nine of those employees were accepted into the program. The initial payout will cost the city $233,650, but will save the city more than $752,000 in 2011. Of those savings, $562,000 will directly benefit the city’s $9 million general fund.
The city saved $89,500 by increasing the amount of water, sewer and stormwater tax revenues that funnel to the general fund by 2 percent. Fund transfers adjustments saved the city roughly $436,000.
Unresolved contract negotiations with the Poulsbo Police Officers Association have left one budget element unknown. Negotiations could go to arbitration in January if not resolved, a process which could last until next summer, Human Resources Manager Deanna Kingery said.
With no clear decision, the city will have to allocate some of its reserves based on assumption it will need to make payments after the contract is signed, Booher said.
The preliminary budget will be released Oct. 31. Public hearings are scheduled for Nov. 3, 10 and 17. A final budget approval is expected in December. For more information, visit cityofpoulsbo.com.
