Takoma Park to cut staff for first time in its history
Budget proposal also calls for pay freeze to avoid raising taxes
Ten Takoma Park city staff positions will be cut or reduced in the city manager's proposed budget for fiscal 2011, which also includes a pay freeze for other city employees in the hopes that tax rates for residents can remain relatively stable in one of the tightest financial years in history.
The proposed budget estimates the city will earn $21.2 million in revenue, down from the $26.4 million in fiscal 2010. The budget also covers the city's estimated total expenditures of about $25 million, roughly $3 million less than the expenditures in the approved fiscal 2010 budget.
Four full-time employees and four part-time positions will be cut, while another two full-time employees will have their hours reduced to part-time status, according to city officials, including City Manager Barbara Burns Matthews, who presented her budget to the City Council Monday night.
"Obviously, we're a service industry, so the single largest part of the city's operating cost is personnel," she told the council. "I want to assure the council and the city's employees that these recommendations are not made lightly; ... one of my goals as a city manager (in making these cuts) was to basically avoid further layoff of city staff."
Although the cuts and the budget in general will not become official until the council has had a chance to make changes and vote to approve the document in May, the layoffs mark a first in the city's 121-year history, Deputy City Manager Suzanne Ludlow said. The city now has about 150 employees, she said.
The cuts, coupled with Matthews' proposed pay freeze, were made partly to ensure the real property tax rate for residents and property owners could be kept at its current rate of 58 cents per $100 of assessed value, she said.
"Many of our residents and property owners are also dealing with tough times," Matthews told the council. "Many of them have lost jobs; many of them aren't getting raises, so I at least wanted to make an effort not to increase the tax rate."
Although the cuts have balanced the city's budget as it stands, the Maryland General Assembly and Montgomery County Council have yet to approve their respective budgets, presented by Gov. Martin O'Malley (D) and County Executive Isiah Leggett (D), respectively, meaning additional shortfalls to the city's budget might occur, Matthews said.
"Both the state and the county are dealing with structural deficits and have been for some time," she said. "Some of the city's key revenue sources come from the state and county, so certainly as they struggle to balance their own budgets, that (have) had an impact on us."
The council now will embark on its annual gauntlet of public hearings with residents and special work sessions with city department heads to tweak Matthews' figures and approve a budget in time for the beginning of the 2011 fiscal year on July 1. The process will begin with a public hearing on the budget and the proposed tax rate April 12.
Residents are encouraged to attend the hearing to provide council members with feedback regarding the evaluation of city services and views on the tax rate.
Despite the tentative nature of the budget at this time and the high likelihood of changes before it is approved expenditures dropped about $500,000 and revenues increased about $5 million between the time the budget was proposed and approved in fiscal 2010 Mayor Bruce Williams applauded Matthews' efforts to provide the council with a structured starting place, even with the layoffs.
"I know it's very hard for everybody to contemplate a reduction in city staff," he said following Matthews' presentation. "This is something that nobody wants to do, nobody looks forward to doing, but I think the financial situation demands it."