Proposed city budget cuts spending $1 million, includes layoffs, no raises, no tax hike

Gainesville City Manager Russ Blackburn is shown in a June 26, 2014 file photo.

Published: Thursday, June 26, 2014 at 8:45 p.m.
Last Modified: Thursday, June 26, 2014 at 8:45 p.m.

On Thursday, City Manager Russ Blackburn released a proposed fiscal year 2014-15 budget that holds the line on property tax rates, reduces the transfer of utility revenues to the general fund and includes some layoffs and no raises.

Blackburn said the budget is intended to maintain the current level of city services, although some will now be contracted out, while avoiding an increase in property tax rates and offering some relief to upward electric rate pressure by cutting the transfer of utility revenues.

The approximately $106.17 million proposed general government budget trims almost $1 million from this year’s approved budget of $107.1 million.

The annual spending plan would cut 22.5 full-time equivalent positions. Approximately half are vacant but 11 employees will face layoffs if they cannot find another position with city government. That includes the city’s nine custodial workers, who will have their positions eliminated as the city outsources that service to save a projected $50,000 next year. Four vacant right-of-way mowing positions in Public Works also will be eliminated as the city contracts out that service to save about $70,000.

The police department budget, the largest department budget in the general fund, would decline slightly, by about $30,000, to $33.26 million. The department’s operating costs, for materials, insurance, supplies and fleet, will rise by almost $200,000, with personnel costs trimmed by more than $200,000. Two vacant department positions — a captain and community relations coordinator — are not funded in the budget. The fire department budget would increase slightly from $16.15 million to $16.26 million, with the fire assessment proposed to remain the same as this year — $78 per fire protection unit.

The number of units assigned to a property is determined by the type of use — industrial and commercial buildings receive more than residential — and its square footage.

After four years of declining property values, the city’s tax base will again increase, by some 7 percent, to a projected $5.52 billion. The increase comes almost entirely from a single property, the biomass plant, which goes on the tax rolls with a taxable value of $340 million.

Since the Gainesville Renewable Energy Center pays its tax bill with money brought in through the sale of power to Gainesville Regional Utilities and its electric customers, the transfer of utility revenues to the general fund will be further reduced by the amount of property taxes the plant pays to the city, a projected $1.4 million.

Right now, the proposed budget maintains the same property tax rate as the current fiscal year — 4.578 mills. One mill equals $1 of tax for every $1,000 of taxable property value.

But Administrative Services Director Becky Rountree said that, based on updated property value numbers the city just received from the Property Appraiser’s Office, the staff expects to bring city commissioners a small reduction in the tax rate when budget meetings begin next month.

Blackburn said the main challenge, and the most significant piece in a $2.7 million shortfall staff had to fill to propose a balanced budget, was the reduction in the general fund transfer.

With the biomass plant pushing up customer electric rates and also generating property tax revenues for the general fund, the City Commission decided months ago to reduce the general fund transfer in the upcoming fiscal year.

The proposed transfer for 2014-15 is almost $34.9 million, so it remains the single largest piece of the city’s general fund. But it is more than $3 million below the budgeted transfer amount for this current fiscal year, $38.1 million. Because of lower than expected sales, the actual transfer this year is expected to be about $37.3 million, which is several hundred thousand dollars below the budgeted amount.

Mayor Ed Braddy said he felt the proposed budget was a “good working document” that attempts to “limit the cost of government while maintaining the high level of services.”

With the city and county asking voters in November to tax themselves with an additional one-cent sales tax for transportation, and electric rates again rising from the biomass plant, Braddy said he felt it would be “unacceptable” to increase property taxes and fees.

Reader comments posted to this article may be published in our print edition. All rights reserved. This copyrighted material may not be re-published without permission. Links are encouraged.

▲ Return to Top