| City still whittling $700K from its budget |
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Posted: Monday, June 22, 2009 10:41 pm
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By CLARE KENNEDY
ckennedy@owatonna.com
OWATONNA — The good news is that Gov. Tim Pawlenty slashed only $450,000 from Owatonna’s promised amount of Local Government Aid (LGA)— tax money collected by the state then redistributed among counties and cities twice a year. The bad news is that all the proposed cuts will become a definite reality.
News of Pawlenty’s latest cuts to LGA came last Tuesday, but this is just the latest development in the state’s budget roller coaster. In December 2008, the City of Owatonna absorbed a loss of $534,970 in LGA with little warning, after state officials discovered short-term $426 million state deficit.
The state’s December budget crisis was resolved but the turmoil was not over yet. Officials predicted a multi-billion dollar deficit in 2009. Fearing another LGA crisis, in January 2009 the city began planning $700,000 in cuts to services and budget line items. City department heads began whittling down their department budgets to the bare minimum, hoping for the best but preparing for the worst.
The city’s cuts covered a broad spectrum.
“It’s all from different line items — taking a little office supplies here and part-time folks there,” said City Administrator Kris Busse. “It’s spread all over.”
After months of waiting city officials finally found out on June 16 what the true tally would be after Pawlenty announced cuts to LGA in 2009. Though the city will not lose all $700,000, they will not be loosening their belt anytime soon.
“We are going to do the whole $700,000,” Busse said. “Mainly for two reasons: One, we got cut in 2008 by $535,000 and we had to take that out of our fund balance so we need to cut as much as we can this year to try and get caught up. Plus next year we’ll lose more, so we thought we should do the full $700,000.”
And there’s probably more where that came from: In 2010 the $4.2 million LGA payment promised to the city will be reduced by $1.4 million. When asked if the cuts already planned will be sufficient Busse said no.
“We’ll have to do more in 2010,” Busse said.
Nothing is off the table, Busse said, though a lot depends on how many opt for early retirement packages unveiled last week. She said she could not rule out future layoffs.
“I can’t sit here and say we would never lay anyone off because we might have to,” Busse said.
From Busse’s chair, it looks like a no-frills future.
“I’m thinking ahead where we have some of these other items that are really nice to do but maybe in the scheme of things aren’t core services, for example fireworks or our community band,” Busse said. “Some of those things in 2010 will definitely be looked at.”
The budget crisis could even affect how the city deals with special events in city parks. In the past, the city would gladly pay overtime to employees to set up grandstands and stage clean-up for a non-profit shindig at Central Park.
“We’ve been kind of struggling with that a bit because we have fewer part-time people to do that and we try to accommodate during regular hours or shift hours around but you can’t always do that,” Busse said. “We are now kind of looking at saying, OK, if you want these services you’re going to have to pay.”
The public may also pay a cost in higher fees for city services.
“That’s a possibility though we haven’t talked about it much,” Busse said.
Similarly, Busse did not rule out raising the rent at West Hills Complex, though she said rent and service fees constitute a very small portion of city revenues.
Clare Kennedy can be reached at 444-2376.
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