Council discusses budget plan and parking prices

Council discusses budget plan and parking prices

Dave Boitano

The need for a multi-year budget plan to prepare for higher pension and other employee costs was discussed at the special meeting of the City Council on Tuesday night.

The council reviewed the spending plan for the 2013-2014 and 2014-2015 fiscal years but took no action. Adoption of the final, two-year budget, which includes expenditures of $163 million next year, will take place next month.

A variety of budget cuts, including demoting some City Hall workers and offering voluntary layoff plans to current employees, are expected to help eliminate a portion of a projected deficit of $3.5 million in the upcoming fiscal year. So far nine city workers have volunteered to accept a layoff, a presentation offered Tuesday showed.

That deficit will grow to $5.2 million in the 2014-2015 fiscal year and as high as $8.3 million by 2017 unless reductions are made.

Employee pension costs as reflected in payments to the Public Employee Retirement Fund are approximately $10 million annually and are projected to grow by $511,000 in the 2014-15 fiscal year and as high as $3.2 million by 2019-2020.

Costs of providing health care for retirees will also rise in coming years, the budget plan projects.

To offset higher costs, the city and its public safety unions forged contract agreements that provide for higher contributions by police and fire personnel to their pension benefits.

City Treasurer Kevin Kennedy suggested that the council hold serious discussions about pension and health benefits and deferred maintenance costs because in future years the city will be faced with large debts, the equivalent of not being about to pay the interest on a personal credit card, he said.

Mayor Marie Gilmore said that there needs to be some consensus on the city’s priorities, including deferred maintenance projects. While council members think repairing streets is a high priority, the public may not share that view, she said.

“We are all going to have to get on the same page and pulling in the same direction,” she said.

The city will have some “tough discussions” on future employee costs with its unions but officials of other cities have been amazed at the cooperation the bargaining units have offered, Gilmore said.

The city’s budget process has improved over previous years, she added.

“We have made progress,” Gilmore said. “We may agree or disagree about the rate of the progress but we have made progress and the hallmark of this council has not been to kick the can down the road.”

In a related item, the council unanimously approved increased parking meter fees of between 25 cents and one dollar per hour in the city’s downtown parking structure and lots in local business districts. The rate increases are expected to bring in more than $375,000 annually.

In a related item, the council raised fines for a host of parking violations. The higher fines will bring in an additional $380,000 a year and are close to the average amount charged by other cities for the same violations. Council member declined to change fines levied for disabled parking, yellow and white zone and abandoned highway vehicles violations.

The council is expected to approve the budget on June 11.