City faces $1.4M revenue gap

Waynesboro City Council members learned Monday that the city is experiencing a revenue gap of nearly $1.4 million in fiscal year 2009.

City Manager Mike Hamp said that is due to a $1 million drop in retail sales tax revenue, a $212,000 drop in retail sales licenses and a $138,000 drop in investment income.

Staff and department heads, Hamp said, have identified $500,000 in reductions, leaving a gap of about $900,000.

“Closing the gap will require a combination of performance reductions, eliminations and, in some cases, restructuring or reorganizing the operational delivery of services, and in some cases, perhaps even their funding sources,” Hamp said.

Budget Director Pat Nicosia said the city had originally projected $5.1 million in sales tax revenue, but is now projecting about $4.1 million. For the first five months of the current fiscal year, the city received between $337,000 and $365,000 monthly. Lodging tax revenue is projected to be more than $42,000 below expected levels, while meals tax revenue is expected to see an increase of just more than $70,000.

Service cuts will be unavoidable, Hamp said.

“Our goal as a staff, clearly, would be to preserve current service levels, particularly core service elements — public safety, public works, road maintenance, those kinds of things,” Hamp said.

He said the city would have to go through the budget, line item by line item, to get through the rest of the current budget year.

“No expenditure is too small to escape consideration,” Hamp said.

Nicosia said a lot of the cuts would impact training and education programs for city employees. Councilwoman Lorie Smith said she would like a list of items that are cut that will eventually have to be restored in the budget.

“Once you take things away, it’s really hard to get them back,” Smith said.

Vice Mayor Frank Lucente said it was hard enough to have to take items away.

Hamp said it would take a combination of small and large cuts alike — “$75 to $75,000 reductions” – to balance the budget by the end of the fiscal year in June, but said there has been no grumbling among staff.

“We have a lot of work before us, and we will keep you informed as we go,” Hamp said.