Wichita city officials again have deficit holes to plug as they begin preparing the 2014 and 2015 budgets.
The local economy is improving slightly but not enough to affect projected general fund deficits of $1.3 million this year, $3.6 million in 2014 and between $4 million and $4.9 million in 2015.
Many of the variables that have tested past city budgets have moderated, Mark Manning, the city’s budget officer, told City Council members at a budget workshop Tuesday. Sales tax and franchise fee revenue should grow, the city expects its assessed valuation to grow slightly, health insurance costs have decreased, and pension and fuel costs have moderated.
But spending is expected to grow faster than revenue in the next few years, Manning said.
He also noted that Sedgwick County officials expect property valuations to remain static rather than grow slightly, as the city projects.
“We might have to roll some of this back,” he said.
City Manager Robert Layton said after the meeting that the projections contained good and bad news.
“The magnitude of the projected deficits is less than last year, so in terms of how much money we have to make up, we’re in a better position,” he said.
But the number of moves the city can make is limited by the work Layton and his staff have already done. Last year, they used a variety of tactics – adjusting street maintenance through a variety of pilot programs using cheaper techniques, service reductions such as cutting library hours and leaving many open positions unfilled – to bridge deficits of $1.4 million in 2012 and $6.5 million this year.
“We’re in a more difficult position because of the work we’ve done ... to repurpose our organization,” Layton said. “We really thoroughly evaluated what we were doing, so it’s going to be harder to find, say, $4 million.”
Layton declined to speculate Tuesday on the source of any cuts, pending internal reviews. He told the council that he and city department heads will begin working through the budget shortfalls immediately to balance each of the next three years.
However, he said the city is “not in a hard (hiring) freeze.” Top-level positions will continue to be strategically filled, with some lower-level jobs remaining open.
The city now lists 20 open jobs on its website, wichita.gov, and in recent weeks has listed as many as 30.
Mayor Carl Brewer said he wasn’t surprised by the projections, given the city’s sluggish economic growth.
“Pretty much what I had anticipated,” Brewer said. “With the economy like it is, and with some departments that we had to go over budget on – for example, who was expecting this kind of weather? Most people don’t realize what goes into a storm. We have to prepare a couple of days in advance, because if we don’t and it comes, we’re skewered.”