Munroe Falls -- Even while city officials are contemplating another attempt at convincing voters to approve tax increases, they have also begun looking at cuts in next year's budget.
"I don't want to speak for the mayor and the department heads, but given the results of the election, I think there's going to be some staffing considerations," said City Councilor Steve Stahl, who chairs Council's finance committee meeting, at Council's Nov. 15 meeting.
Mayor James Armstrong cautioned that it is too soon to say what will be cut.
"I don't want to say anything now because I don't want people to go, 'Oh my gosh,' you know, that type of thing, but we need to, once we look into seeing where we can save any more money because, I mean, there wasn't a whole lot next year to begin with," he said.
In the Nov. 8 general election, voters rejected two tax issues, an increase in the city's income tax rate from 2 to 2.25 percent and a five-year, 2.8-mill police levy that it was estimated would have respectively brought in about $276,000 and about $300,000 in additional annual revenue.
Voters approved a 10-year, 2-mill capital improvement levy that it is estimated will raise about $214,000 annually for such projects as road work and stormwater mitigation. Because receipt of property tax revenue is six months behind collections, however, the city will not receive revenue until the second half of 2017 and only about half the annual amount.
Armstrong told the Stow Sentry Nov. 22 that he wants to place the two rejected issues on the next regularly scheduled election ballot, which would be the May 2 primary, avoiding a special election because there would be a cost to the city.
Armstrong said cuts to the city's 2017 budget appropriations have not been identified, but they will be difficult.
"We're already working on reduced staff," he said.
During the Nov. 15 meeting, at least some Council members expressed support for another attempt.
"I think it's going to pass eventually, but when is key," said Stahl.
"Seriously, we need the money," said Councilor Jim Iona.
But there is still next year's budget to contend with. Normally, Council approves the following year's permanent budget appropriations by the end of the year, but because of delays caused by uncertainties over the Nov. 8 election, Council is only expected to approve a temporary budget, with a permanent budget prepared and approved by the March 31 state deadline.
"If we can pass next year's budget by the end of February I'll be pleased, cause I think there have to be some hard decisions to make," said Stahl.
City officials say the city is cutting into budget surpluses. Armstrong said the general fund is expected to have a nearly $500,000 shortfall at the end of the year and Finance Director Karen Reynolds said the fund's surplus is expected to be about $926,000. This is significantly lower than the nearly $2 million the city had just two years ago because of shortfalls each year.
"At the end of the year, it will be [a total of] over a million dollars in the last three years," said Armstrong.
He said part of the problem is about $175,000 less in annual revenue from the state since 2010, thanks to the elimination of the estate tax and reductions in the city's share of sales taxes.
Stahl said, "I don't want to get ahead of anybody or anything, but we cannot afford to spend four, $500,000 more than we are bringing in," adding that, "I think there have to be some substantial cuts. I mean I don't think there's any way around that."
But city officials say there is no way that enough cuts could be made to completely eliminate the shortfall.
"There's no way you can even operate if you cut $500,000," Service Director Jim Bowery told Council.
"You can't function," said Armstrong.
Stahl suggested that the budget be cut to bring the estimated shortfall at the end of 2017 down to no more than $350,000 while Council President Gary Toth said, "My thought was [$300,000], so somewhere between these two."
"In my opinion, the most austere budget you can put out there [is crucial]," said Stahl.
"As painful as it is," he added to Bowery, "if you've got a vacant position, don't fill it."
Councilor Chris Ritzinger said "you've got to look at River [Fest]," as a source of cuts, while Armstrong suggested operations at City Hall, which is "understaffed" and will remain so "for the foreseeable future," may have to be cut, either by cutting hours during the day or going to a four-day week to save on utility costs.
"There are a lot of difficult decisions that need to be made regarding the operating [costs], very difficult decisions," said Armstrong.
"There's going to be pain, I don't thinks there's any doubt," said Stahl.
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