How do you fix the city's financial woes?

March 10, 2010 4:49:03 PM PST
Struggling to make up for a multi-million dollar deficit, the city of Houston is now weighing its options. They're options that could mean big financial sacrifices, especially for city workers. The city has two months to come up with a budget that helps get Houston out of the red without raising taxes. And now, we're getting a better idea of just what cuts could be in store.

"There's some structural problems we'll have to address," said Houston Mayor Annise Parker. "You cannot spend more money than you take in."

It's said that Houston's the last to feel an economic pullback. But at the city, that time has arrived.

"Property tax graph has fallen like a rock, and it doesn't look like it's going to reverse," said Houston Councilmember Mike Sullivan. "There's no way to know, but it probably won't reverse in the near future."

On Wednesday, city council was briefed on the current budget and the next one due later this year and they go from bad to worse. According to the city finance director, there's a nearly $12 million gap with the 2010 budget and it could grow.

Options to control it include more department cuts on top of delayed purchases and jobs cut by attrition. The shortfall could also be offset by borrowing by the budget fund balance.

Next year, the gap is projected to grow to nearly $100 million. The potential control options increase, too. They include

  • More department spending cuts that could impact personnel
  • A furlough of civilian employees two days a month
  • Consolidating some city departments
  • Negotiating with employee unions to reduce the city's pension fund contribution
  • Negotiate to defer pay raises.

For the moment, classified public safety jobs are secure. That includes fire, police and neighborhood protection. And there's no talk of laying off civilian workers...yet.

"The only circumstance where I could see layoffs is if we decided to stop performing a certain service," said Mayor Parker. "I do not believe there's any service we provide that is not an essential service."

Right now, these are all just talking points.


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