Janesville's financial belt gets tighter
JANESVILLE — Last year, cuts in salaries, personnel and services were off the table.
This year, nothing is.
The city council is facing an estimated $1.8-million deficit in 2010, and that's after $1.2 million is taken from cash reserves to help offset the shortfall.
The shortfall number is based on a zero percent levy increase. A 3 percent levy increase would yield an additional $725,000 in property taxes, bringing the gap to about $1.1 million.
The council met Tuesday at a retreat and got a first look at a budget.
On the revenue side, the city expects to lose money from commercial and residential building activities, interest on investments and state shared revenues.
The city has union contracts that include 3 percent raises through 2010. Non-union staff received 3 percent this year. On top of that, they also typically receive merit pay increases ranging from 3 to 5 percent, depending on length of employment and pay. After 10 years, the formula changes and the employee could lose pay if he or she does not receive a merit pay increase.
City Manager Eric Levitt suggested ways to manage the budget.
"I want to know whether or not (a strategy is) off the table," Levitt said to the council. "I think we're going to have some hard decisions … to look at, and I want to start on the right foot and know what the expectation is."
Strategies and options on the table include:
-- Balancing the budget without using the cash reserve.
-- Levy increases ranging from 0 percent to 3 percent.
-- Increasing users fees.
-- Reducing services.
-- Layoffs, furloughs, salary and hiring freezes, early retirement incentives and eliminating merit pay. Personnel and benefits represent about 78 percent of the general fund.
-- Cutting back on capital projects.
Council members have been concerned about continuing to use the cash reserve to balance the budget. About $6 million remains.
Councilman Bill Truman said he doesn't want to lay off staff. But he said he would not rule out furloughs and eliminating merit pay.
The council could look at raising fees and cutting services, such as increasing landfill fees for outside contractors and picking up garbage every other week.
"I think this year we're going to look at everything on the table," he said.
Councilman Russ Steeber called layoffs "the last resort."
But Frank Perrotto said "everything and more" should be on the table.
Tom McDonald agreed. He asked whether the city could reopen union contracts but was told both sides must agree to that.
Steeber recalled that last year he was adamant against cutting police and fire budgets, and he said he still believes that.
But, "There's certainly other areas we really never dig into. I hate to go to parks and recreation, but I got to. Look at the funding we throw to adult sports. We subsidize a lot of the softball leagues (and the) different league activities that take place in our parks. I have to say, is that one of those things that are really a necessity? Do we increase our fees and still provide it rather than, say, cutting a firefighter or a police officer?"
Councilman George Brunner said the council should have the goal of a zero percent increase in the levy.
"We're in tough times," he said.
State employees are going without increases and are being furloughed, he said.
"I don't want to look like we're in the panic mode, but I think we really need to be in the sharper-pencil mode," Brunner said.
Steeber said it would be a mistake to keep the levy increase at zero percent because the city could never fill the resulting shortfall.
Perrotto agreed.
"We are all going to have some pain here," he said. "If you can do this without a tax increase, it would probably be one of the most creative things I've ever seen anyone do."
McDonald was adamantly against continuing to dip into the fund balance.
"I'd rather have taxes go up a little bit and not have us dipping into the reserves year after year," he said.
He said it's easy for the council to talk about increasing fees. But it just rescinded a bus fare increase and last year opted against increasing swimming admission.
"When we say, 'Everything's on the table, we have to stick with it," he said.
Jun 18, 2009 at 3:38 p.m.
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I wasn't aware that there were requirements for elected office such as the council, other than being a citizen. I'm also disturbed that somebody's personal life is being brought into this. Is a separated/divorced council member not permitted to date?
Jun 18, 2009 at 3:24 p.m.
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Why even have a reserve, if your not going to use it? I can't imagine a time when a reserve is more needed than right now. You have 6 million sitting around for a rainy day. Stick your heads out the window and check the weather...IT'S A DOWNPOUR!!!
Jun 18, 2009 at 3:15 p.m.
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hannah - Sidewalks are payed for by the property owner not the rest of the taxpayers. If you know something I do not please inform me so I can get a refund for my sidewalk that I personally paid for.
Jun 18, 2009 at 3:05 p.m.
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I think the city employees of Janesville should take a pay cut to help out the city budget.
It's happening else where.
Jun 18, 2009 at 11:54 a.m.
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janesvillean -- I agree with everything you mentioned; yet I'm still concerned.
Jun 18, 2009 at 10:27 a.m.
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woody there are tryouts for the hockey team.
Jun 18, 2009 at 10:27 a.m.
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localmatters, you will have an opportunity to exercise your opinion about Rashkin next spring when he is up for re-election. As it is, bankruptcy is a legal option for anyone who is insolvent, and most bankruptcies follow an event such as a medical crisis, job loss, business failure, or divorce.
Jun 18, 2009 at 10:11 a.m.
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After reading the paper this morning I'm concerned that we have a council person who cannot manage his own finances now giving direction for the entire city. Councilman Rashkin filed for chapter 7. I empathize with his situation; however, I am very concerned that he's in charge of my tax dollars.
Jun 18, 2009 at 9:59 a.m.
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It's always fun to make light of government workers, I do it and so do most of the people I know. BUT why should the employees who are serving YOUR needs 24 X 7 take the brunt of any fiscal shortages that are being generated by the current crisis? I have many friends who work in Government and they are some of the most dedicated people I know. Who was out on the streets during the great blizzards and who was putting their lives on the line during the floods sandbagging and keeping your city running? WHo do you see out a 3 AM fixing broken water mains on your street?
If you decide to balance the budget on the backs of 1/3 of the employees left after you take out Police and Fire employees then is that not just a litte unfair to those people who do all of the above mentioned things and thousands of other duties that keep your city running day in and day out?
I understand in industry if production is down then costs must be balanced by lowering wages or cutting benefits to the production workers but in government the production is not down and the expectation is that with staff reductions as a cost saving measure tha t the remaining staff will "pick up the slack" so that means production fo them is actually up!. Would you like to increase your workload and at the same time take a pay cut?
Merit pay as I understand it is based on just that MERIT, it is something that is EARNED each year for duties above and beyond the duties of the normal job description and only by employees with many years of service who no longer get "raises" because they are working in a job classification that has a outdated wage scale set many years ago for the job title.
Lets try and figure out a way to balance this shortage by EVERYONE taking some of the burden. Tax increase, elimination of all projects not currently urgent to the operation of the City's main functions, furlough's if required but everyone should be included in this action not just 1/3 of the employees, A revisiting of all of the "special interest" projects the members of the City Counsil are attempting to champion for whatever reason. I understand you feel the need to leave your mark after your term is up but please lets work together on this. We can do it but it will take EVERYONES efforts.
Jun 18, 2009 at 8:38 a.m.
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Who are the kids that will be playing on this new hockey team? Can any local kid sign up to be on it or maybe it's just for the kids of Forward Janesville members? Does anyone know for sure?
Jun 18, 2009 at 8:06 a.m.
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"The council met Tuesday at a retreat"
*
Where was this retreat and did it cost the taxpayers anything for the council to meet there?
Jun 18, 2009 at 6:50 a.m.
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A 3 percent raise in my pay would look good after last year & this year pay cut.
Jun 18, 2009 at 12:18 a.m.
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If you cut employee wages, they will spend less in the community and add to an already slow economy. Recreational program cuts need to come first, as much as I liked the idea of a hockey team....now simply is not the time.
Jun 17, 2009 at 7:33 p.m.
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What to cut. What to raise. Very difficult decisions. Raising user fees for anything could backfire as everyone has to tighten belts. At what point does a softball player say no more because of the cost? How many less visitors to the pools due to the fees? Those that still use the services pay more, but will it offset those that stop? Payroll and benefits are the big piece of the pie, it seems logical to do some cuts there. Again, people who don't work, don't spend so caution is needed. Good luck to the council on making some tough decisions.
Jun 17, 2009 at 7:10 p.m.
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Nothing is off the table except for subsidies for the ice arena and hockey team. They'd rather cut family wages than they would give up this pet project of theirs.
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