Several Aberdeen Council members repeatedly criticized Mayor Bill Simpson’s proposed operating budget for next year as lacking in spending cuts, but couldn’t come up with specific ideas for cuts of their own Wednesday night during a 45-minute budget workshop.
Last month, Simpson introduced a budget that included no major cuts or layoffs and relied heavily on reserves.
“I don’t know where to cut it … I don’t want anyone to lose their jobs,” Councilwoman Alice Phelps said.
Simpson’s proposed $13.34 million budget cut about $160,000 from the original $13.5 million in requests from various departments, but his cuts didn’t include any personnel or major services. Finance Director Kathryn Skolrood said the budget also defers several hundred thousand dollars in maintenance expenses and other items not found in the requests.
Revenue coming in is expected to be about $12.7 million. That means the city expects to spend about $652,000 of its reserves to balance the spending plan, leaving about $3.6 million in reserves at the end of next year.
On the council floor, Councilman Tim Alstrom made a motion to cut the operating budget by another $200,000.
“I just feel we need to spend a little less,” Alstrom said.
“Where do you plan to get that from?” Councilwoman Margo Shortt asked Alstrom.
“I’m going to leave that to the leadership team,” Alstrom said.
“Our leadership team has been busting their biscuits on this one,” Council President Kathi Hoder said. “If you have an idea of where to cut, God help us, let us know.”
Alstrom’s motion lost on a voice vote, primarily because of the lack of specifics on where the cuts would come from.
Alstrom said he feels uncomfortable giving specifics because as just one council member out of 12 he doesn’t want to micromanage the city’s budget.
“But I think we as a council need to be clear that we’re not happy with this current budget or the leadership’s current approach,” Alstrom said.
Councilman Pete Schave said he’s specifically not happy with the raises granted to city employees. Next year’s budget includes a 3 percent raise for most city employees and 2.7 percent raises for police officers and firefighters.
“I think public salaries may be too bloated and that’s something we need to look at for the next time a contract comes up for negotiations,” Schave said. “We don’t live in a city where there’s a mill on every corner anymore.”
Councilman Frank Gordon said he felt this is the last year the city could rely on reserves as much as it has. However, he noted frugal budgeting in past years has allowed the city to build up a reserve just for this kind of situation. Plus, he noted that the city has not budgeted for increased business activity that could be happening nor a planned building expansion at Grays Harbor College, which could bring in $200,000 in permitting fees and $300,000 in sales tax dollars by the end of the year if the Legislature allocates the funds.
Skolrood provided an overview of the city’s use of reserves, showing that the city dipped into reserves in 2008 by $294,303, but actually increased reserves by $568,112 in 2009, $593,067 in 2010 and $938,033 in 2011. This year the city is expected to spend the reserves back down by $522,000 and next year’s budget spends it down $652,060, leaving about $3.6 million in reserves at the end of next year.
Skolrood also provided documentation showing that if the city were to implement a 2 percent utility tax on stormwater, cable services and garbage services, that could add $129,332 in revenue to the city’s operating budget. The city already has a 2 percent tax on water and sewer services. But that would mean even higher utility bills and the city is already looking to increase utility rates for water, sewer, storm and garbage. If all of the rate hikes are combined it would mean a $10.66 monthly increase to the current $104.34 average utility bill.
Phelps and Councilman James Cook both said they didn’t like the idea of the current rate hikes.
Phelps asked if there was any way to reduce the rate hike to only $7.66 per month. But Hoder said that would mean relying even more on reserves or else cutting back on utility services, which would not allow the city to maintain its infrastruture.
Cook noted if the city was going to raise rates, the council ought to make sure more people qualify for senior exemptions to help those on a fixed income.