PORTERDALE - Like local governments all across the state, a tightening economy has officials here faced with making some tough decisions in order to stay within their budget.
City Manager Tom Fox told City Council members at a Thursday night work session that Porterdale faces a $200,000 budget shortfall that must be made up before the fiscal year ends Dec. 31. Fox said the shortfall can be blamed on a decrease in budgeted revenues from sewer tap and permit fees and an increase in expenses, such as fuel and personnel costs. In addition, he said Gov. Sonny Perdue's decision to freeze the homestead tax relief credits, which reimbursed cities and counties for the state exemption, could have a $26,000 to $30,000 impact on the city in the next fiscal year.
For fiscal year 2008, Porterdale budgeted $1.029 million in revenue, including transfers from the sanitation and water and sewer funds. Fox said the budget shortfall is comprised of $188,000 less in anticipated revenues and unbudgeted expenses of $12,000, due primarily to unplanned personnel expenditures.
"To balance our budget we need to cut back about 20 percent immediately," Fox said. "If we don't do something immediately, by the end of the year we will be in significant financial trouble."
Fox's recommendations to the council included reducing employee hours from 40 per week to 32 in order to reach the 20 percent savings. Fox said the city's payroll totals about $27,000 every two weeks. A
hiring freeze should be implemented, as well, and any positions that become open should remain unfilled. Overtime would be eliminated unless approved by the council. In addition, he recommended going through the budget for the remaining months of the year to see where cuts can be made in operating expenses.
Councilwoman Linda Finger said she would like to see employment in the Police Department remain at the current level. However, Fox said that would require deeper cuts in other departments.
"This is not something we want to do, but we have to make it fair across the board," Fox said.
Fox said he and city accountant Benny Phillips had discussed the options available to the city - including job cuts, wage cuts and tax increases - and determined that the furloughs would be preferable.
"This would be a temporary situation until we get in a better financial condition," Fox said.
Mayor Bobby Hamby asked Fox to prepare a complete recommendation showing where cuts can be made and savings implemented and present it to the council at a future meeting.