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PTC gets to work on trimming budget

In their first hack at the proposed budget Wednesday night, most of the Peachtree City Council admitted to having little stomach for making any further cuts that would affect city services.

Councilman Eric Imker is the only one of five council members who indicated a desire for service cuts. He wants to adopt furlough days, across the board pay cuts and other initiatives, and he is also proposing to eliminate the city's 401(k) retirement program which would leave employees with just one retirement option: a defined benefits pension plan.

The budget proposed by City Manager Bernie McMullen includes a minimum .25 mill increase in the city’s property tax rate to make up for the loss in property tax revenues from the reduced property values in this year’s tax digest.

Imker was able to convince his fellow councilman that they needed to take action to correct a projected $18 million shortfall over the next five years. Imker said a large chunk of that could be alleviated by adopting a 1 mill property tax increase this year, and he felt it would be justified; ultimately however that’s a suggestion he is adamantly opposed to.

Finance Director Paul Salvatore noted that much of the city’s projected shortfall is due to previous councils who would hire staffers and approve capital expenditures without increasing revenues commensurately. Imker concurred.

Salvatore noted that in the budget projection for 2013 city staff has projected the possibility of losing as much as $1 million a year in local sales tax revenues when the Census figures come in, as the city’s cut could be reduced in favor of communities that are gaining in population.

Councilman Doug Sturbaum suggested the city remove the purchase of eight police vehicles and a new fire engine from the budget, which would be purchased with the city’s ample stash of cash reserves. But staff noted that would merely be pushing those needs off on next year’s budget.

The new fire engine is needed to push one of the older engines back to a reserve status, explained Assistant Fire Chief Joe O’Conor. Without a reserve engine, when one of them is in the shop for repairs, that particular fire station goes without a fire engine and the area is covered by the two closest fire stations, O’Conor said.

Mayor Don Haddix said he was unwilling to cut the new fire engine. Imker said he appreciated the value of the fire engine especially since many city property owners saw a reduction in their home insurance rates as the city achieved a lower rating due to improvements in the fire department.

“That value, versus the cost of a new engine, greatly exceed the cost of the new engine,” Imker said.

Sturbaum said he would also like to see numbers and service level estimates for five percent budget cuts on every department. He also said he wanted to see figures detailing the impacts of millage rate increases of .25, .5, .75 and 1 full mill on the property tax rate.

McMullen said he might recommend a further hiring freeze, but noted that it would affect all departments including police and fire operations. Part-time salaries might also be cut including those of firefighters who are used to cover for full-timers who are on vacation or sick leave.

Councilmembers Kim Learnard, Vanessa Fleisch and Mayor Don Haddix each remarked they felt city staff has already been cut as deep as possible. This year’s budget includes six full-time and four part-time positions that will be unfunded and “frozen.”

The budget also does not include any pay raises for city employees, who took an effective pay cut last year as the city increased employee contributions to its medical insurance plan to the tune of $600 per employee.

City employees are also working harder due to hiring freezes and other staff reductions, as the city in the past two years has gone from staffing of 259 full-time positions to 231 employees now.

The city has also adopted policies to charge employees for the privilege of using a take-home vehicle, and the previous benefits afforded to part-time employees have been axed, all in an effort to keep the budget under control.

Among the 38 eliminated positions were the assistant city manager, 23 people in public works maintenance, six in recreation maintenance, four in the building department, and one each from code enforcement, engineering, planning and the Kedron Fieldhouse and Aquatic Center.

Last year the city added six firefighters via a federal grant, a police patrolman and a detective along with a customer service representative and a contract manager for public works to handle the city’s outsourcing of grass mowing and landscaping services that was required with the public works and recreation layoffs.

The budget recommended by McMullen includes a reduction in $49,000 for the city’s July 4 events, as the costs are being shifted to the city’s Tourism Association, which is funded by revenue from the city’s hotel-motel tax.

As for other cuts advocated by Imker, a furlough day would save the city $46,000 and eliminating the city’s 401(k) retirement program would save $170,000.

A one percent across the board salary reduction for all staff would save about $133,000.



Just a thought.

LOL! I doubt it, Spyglass! But then again, you get what you pay for, right?

Apparently Mr. Imker is the only one on PTCs council that realizes that next year will be even worse by 10-20% than is this year for budgets---especially from the State and Federal contributions.

Two years from now isn't likely to be better for sales taxes and property values.

If a cut in headcounts isn't started now, there will be too much of a cut required the next two years to tolerate!
Why do these people want to raise taxes and spend reserves? Are they running next time for reelection?
I'm also not interested in hearing about cutting "services! Is that the same thing as a few headcounts?

Hotels's picture

No one has the stomach for this yet it has to be done. Let's get moving on some viable decisions. This article, while informative lacks substance as was the action it communicates about. While an increase in cost to the city's employees for medical may seem to result in a pay cut it is the reality of the times. $50 a month is nothing in comparison to what others have been asked to pay at the largest corporations in America. A 1% pay cut, gheez, where were you wimps when the BOE forced our underpaid teachers to give up 4.0% ,take 4 furlough days, pay higher insurance rates plus surcharges, plus higher co pays, plus loose the Purdue Gift cards causing self funding, etc. I can live with putting off the fire engine and police car purchases. Is it fact that the insurance ratings will indeed change or is this speculation? The mayor was telling me they have to be acquired due to law. I don't mind a tax increase either if there is no other way and there is evidence this council truly is making /made hard decisions.

You all need to list everything that is required to get to your savings number plus another 20%, then go back and agree what can't be done on the list for safety sake, or cause and effect purposes i.e. short term savings vs. long term costs/effect.. That will be your dead last number. If you don't make this list you'll never get where you need to be. My rule in business is cut deeper than needed, to the point it hurts. At that point if applicable you can treat yourself to spending more to correct an issue. Often you'll find the anticipated problem was never realized at all.
The sanitation folks got it right.. as upset as I was when the rates did not change but the service was cut in half I adjusted. Guess I did not need two pickups a week after all..

Imker here.
I do NOT advocate service cuts. My position is clear in that we can balance next year's budget w/o a tax increase or service cuts. Like it or not, employees would have to HELP solve the problem. (There are a lot of other non-employee related savings and changes I've been advocating as well.) I've been saying this since January. I still support that position.

The story here in the Citizen may have taken one line from a 4 1/2 hour long meeting where very late in the evening where the mayor was informally polling council and leaving only two choices: either a tax increase or service cuts. It was a loaded question of course. I've been saying all along there is another choice; i.e. my position.

NUK_1's picture doesn't sound like you've sold the rest of the Council on your ideas yet. It doesn't help that you have inherited a mess that was made even worse by the PR bull of axing all the low-paid PW jobs as a "big savings" while not discussing how it was a BIG service cut that has also angered people. That blame goes to Haddix, but you have to deal with it. Previous Council was so proud of themselves for saving over 800K that they spent a lot of time patting themselves on the back when they weren't "shaping" the spin on what a service cut it was.

So, you have your work cut out for you. It's nice to say that govt should be run like a business, but most elected types have no spine at all for backing up their words with action. It's always "cut, cut, cut....WAIT! You can't cut THAT! Cut something else!" And the "something else" never happens.

If we were dealing with a "business" here and not gov't, you damn well know the pain would indeed be laid right on the employees' backs and TOO DAMN BAD if they don't like it. They can go elsewhere or suck it up. That won't happen in PTC where you have some very entrenched people as well as a mentality that they are untouchable because they will outlast the elected Councilmembers. Maybe it's time to lop off some heads and change that thinking.

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