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Financial task force discusses options to overcome deficit

Wednesday, July 13, 2011

With opinions as varied as the personalities of members of the Cherokee Village City Council, ways to address the city's $353,027 deficit once again came front and center at the Financial Task Force meeting. After seven months, the city is still scrambling to come up with a solution that is agreeable to all.

To many, it is almost like beating a dead horse, as the topic repeatedly comes up with no solution. Few members of council complain about "negative publicity," but with an eight member council and a massive deficit a solution needs to be reached.

During the July 7 meeting, aldermen discussed various options for resolving the deficit, but most were in agreement, they should work harder to maintain a balanced budget for 2012.

Many of the problems from the 2011 budget are trickling down from the previous two years, and a solution is very hard achieve.

Alderman Lynn Maxedon opened the meeting, stating, "It is time to talk about voluntary retirements, reduction in salaries, if we want to keep going as a city. I am very afraid, if this compounds next year, the shape we might be in."

Alderwoman Verna Mae Newman then countered Maxedon stating, "No one is going to retire for $500." This is the amount proposed as an incentive to coax the two employees eligible for early retirement to do so. The employees are Fire Chief Mike Taylor and City Inspector Charles Deloach.

Alderman Tom Thone, one who has been a staunch believer in cutting expenses prior to increasing revenue, said "So, we are finally taking about making some cuts."

Mayor Lloyd Hefley explained to council it is important that the city be cautious in cutting services it is obligated to provide to the citizens of the city. He explained the city has some reserves and said there is a some indication the economy is beginning to pick up.

The mayor explained maintaining core services and increasing revenue through a sales tax, a millage increase, or franchise fees would be the city's best option. Alderman Curtis Bratcher then added, "We only need these departments if we can afford them."

The discussion continued with Newman explaining the city is a business which needs revenue to operate. "We need to quit dilly-dallying and go forward with a millage and encourage voters to pass a sales tax. This will generate over $200,000. I realize it is not going to happen overnight, but we need to work on the 2011 budget and get the 2012 budget in line."

She suggested asking departments to make cuts in the amount of 10 or 20 percent, something many have already done, place a limit on animal control and switch to one council meeting a month to help with the deficit.

Newman was of the opinion cutting employees and offering a $500 retirement incentive was, "ridiculous." She said cutting employees hours in half would cause the city to lose valuable employees.

It seemed members were in agreement, that the problem with budgeting is that the numbers are always projected.

A rise in one revenue stream or decrease in another can send a budget out of control early in the year. One of Cherokee Village's main issues is its revenue from SID to the fire and street departments has decreased drastically.

Alderman Ray Torbitt suggested the city eliminate $123,000 for cold mix for the street departments. His opinion was soon countered by both Thone and Maxedon, who said the street department was in good shape and should not be considered for that cut.

By the end of the meeting, council was in agreement, it will not be able to solve the budget issue for 2011, but had come up with many ideas to help during 2012.

Alderman Russ Stokes suggested, when creating the 2012 budget, SID decreases be applied when budgeting.

Stokes also said, if the city must make cuts, it should rely on the "last in, first out" method, as well as evaluating services and relying on department heads for evalutations and recommendations. Stokes said he doesn't believe the sales tax will pass. He said the city needs revenue, and suggested things such as a stipend in city employees health care.

There seemed to be no agreement on whether to cut or not, or where to cut if there was an agreement.

Newman said the city will survive and she is confident of that. The mayor simply said, "We need to increase revenues and see what 2012 holds."

But Alderman Maxedon told council, "Since our last task force meeting, managers have cut out over $100,000 from the budget we passed, and we still have a $353,516 deficit. Talking about adding revenue is fine, but we still need to talk about cutting expenses."

Before the end of the meeting, Alderman Jerry Adams explained before jobs are cut, he would rather see the animal control issue addressed. Newman agreed with Adams.

By eliminating animal control, Adams said the city would save $85,000.

"I don't know why we as a city are taking on a county wide burden."

He further explained the proposed closure could be done over a period of time or give another entity time to take it over.

Adams explained the city is paying utilities and salaries of employees of animal control. Torbitt quickly told him Animal Control claims AHHA is providing food, vet care and medicine for the animals; the city was not buying anything for them.

The mayor then chimed in "The only thing that changes with lower numbers of animals is the food cost. Everything else remains the same."

Police Chief Ricky Crook told the council the shelter had received a donation of 6,382 pounds of dog food. Volunteers for AHHA also spoke up, explaining that shutting down the shelter will not solve the problem.

Adams then explained his appreciation for the volunteers of AHHA and their efforts and said he would like to see the shelter remain open but said they need to encourage the public to vote for the one percent sales tax in September, because the city can't keep throwing money down the drain.

The meeting ended when it was time to move onto the regular monthly city council meeting.



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