The Champaign City Council will discuss the recommended Budget Strategy Implementation Plan for the current fiscal year at a Study Session on January 25th at 7:00 p.m. at the City Council Chambers, 102 N. Neil Street. City Administration will present a recommended strategy to eliminate a $2 million budget gap for the current fiscal year. The proposed budget-balancing measures will preserve the City’s sound fiscal condition and preserve high quality services over the long-term.
“After implementing budget-balancing measures of close to $9 million over the past few years, we are faced with making even deeper cuts to operations and capital projects,” says Finance Director Richard Schnuer. While City’s expenditures continue to increase at rates much higher than inflation, revenues have fallen to levels not seen since FY 04/05. “The reality is we can’t spend more than we take in; we must balance the budget,” added Schnuer.
At the November 23, 2010 Study Session, Council directed the Administration to prepare the plan to address the current year funding gap and a future funding gap projected in the Five Year Forecast. The Budget Strategy recommends that the City Council approve $3.5 million in budget-balancing measures to address the current year shortfall and get ahead of cuts that are anticipated for next year. Key elements of the strategy include:
- General Operating Fund Expenditure Cuts
- One-Time Reduction to Capital Improvements
- General Operating Fund Revenue Increases
- Voluntary Separation Incentive Program
“This is the most challenging financial situation I have experienced in my 40 years in City government. These are tough economic times that are impacting cities across the country and difficult decisions have to be made. Unfortunately, the proposed cuts cannot be accomplished without a reduction in City service levels,” says City Manager Steve Carter.
Some examples of service reductions include:
- Reduced Public Hours at the Police Front Desk to 7 a.m. to 7 p.m. daily
- Reduced Availability of 1 Fire Engine Company at Fire Station #4
- Consolidation of Public Works Customer Service Staff at the Public Works Facility
- Reduced Drainage and Right of Way Monitoring and Enforcement Services
- Elimination of Customer Service Staff at the City Building Information Desk
Because budget savings cannot be achieved without a reduction in the City’s workforce, the proposed strategy will significantly affect City employees and their families. Since 2008, more than 18 positions have been eliminated from the City’s workforce, excluding the Library and METCAD. An additional 15 positions will be reduced if the budget reduction strategy is approved this year. “The loss of these coworkers will impact the community and the whole City organization. We have exceptional employees who work hard to deliver quality services for the citizens of Champaign,” added Carter. “My heart goes out to City employees and their families during this difficult time.”
City Staff will recommend a Voluntary Separation Incentive Program to encourage employees to leave voluntarily and minimize the need for layoffs. While employee layoffs may be necessary, the Administration hopes the incentive program will help the City to achieve its budget reduction goals with a minimum impact on current staff.
If Council directs staff to proceed with the proposed Budget Strategy on Tuesday, a Budget Amendment will be prepared for formal approval in March. The Administration has also begun planning for the FY 11/12 budget. Based on the Five-Year Financial Forecast, departments have been asked to generate suggestions for an additional $2 million in savings options for Council to consider beginning in April.
More information about the specific savings proposals under consideration is available on the City’s website at http://ci.champaign.il.us/departments/finance/budget-division/ under the heading “Contingency Planning Process.” As always, Council discussions about budget and service changes will be held during public meetings. Citizens are encouraged to provide public input throughout the process.