GH draft budget balanced, still has question marks

Nearly $500,000 cut from staff wages, layoffs looming

Nate Hulings

of the Gateway

With a thud, the City of Gig Harbor’s 2010 preliminary budget was released at this Monday’s City Council meeting.

The 200-page document, set to the tune of $49.9 million, outlines where the city has been and where it needs to go in terms of the budget, funds and revenues.

Facing a $1.9 million budget shortfall, Gig Harbor began taking cost-cutting measures in August with the announcement of layoffs.

In a letter prefacing the detailed budget, Mayor Chuck Hunter outlined his vision, goals and highlights of the 2010 budget.

It appears staffing levels will take a cut, in lieu of furloughs, with Hunter proposing $450,000 less for staff wages.

“If there are no 2010 furloughs,” the letter reads, “additional layoffs in addition to the six listed above would most likely occur on or around April 1, 2009.”

Final details on whether there will be a combination of furloughs and staff layoffs are currently being discussed with staff guilds. Guilds have voiced their opposition to additional 2010 furloughs, said Rob Karlinsey, city administrator.

The city has eight mandatory furloughs for the 2009 calendar year, saving more than $100,000.

The letter also lists eight positions that were added in 2007, during “a high point of its growth and capital development boom.”

Three of these positions have already either been eliminated or are scheduled for elimination because of its ties to development fee revenue or necessity.

The city took a $500,000 chunk out of the budget gap by proposing in August to lay-off six city employees — including Public Works Director David Stubchaer. Those staff reductions take effect Jan. 1.

The caveat to this preliminary budget is the success of Initiative 1033, which places additional limitations on city revenue growth, Karlinsey said.

“If it does pass, we’re talking more cuts,” Karlinsey said.

An additional $250,000 could be cut from the city’s 2010 general fund budget if I-1033 passes.

There will also be no Cost of Living Allowance (COLA) increase for non-sworn, union employees and a negative .7 percent decrease for non-represented staff.

Continued expenditures for capital projects are one of the main reasons the budget is $4.14 million higher compared to 2009 year end estimates, according to the letter.

These projects include “the extension of sewer system’s marine outfall, completion of the Wastewater Treatment Plant expansion, conclusion of the Highway 16 interchange improvements at Burnham Drive, and replacement of the Harborview Drive water main.”

This is not the final budget nor is it the last time it will come before the council. The City Council will have two budget work sessions Nov. 2 and 3 to discuss and debate Hunter’s proposed budget. The city will also hold two public hearings on Nov. 9 and Nov. 23 during regular meeting times for public comment.

General fund revenue update

The City of Gig Harbor has budgeted nearly $9.5 million in revenue for the 2010 general fund budget, a slight decrease from the 2009 estimated balance.

As part of a required public hearing during this week’s City Council meeting, David Rodenbach, the city’s finance director, outlined revenue sources for the 2010 general fund budget.

Sales tax, the city’s largest revenue source, is currently budgeted at $4.88 million for next year — nearly a $100,000 increase from this year’s estimated balance. However, the 2010 figure is $1 million lower than 2008 numbers.

Property tax is also budgeted to increase by nearly $20,000 from 2009, in line with the 1 percent statutory limit.

Revenue sources for the general fund include property and sales taxes, along with licenses and permits, intergovernmental revenues, charges for services, fines and forfeits and miscellaneous revenues.

Beginning fund balances also carryover. For 2010, the city estimates $1.3 million in its beginning fund balance — about $100,000 less than 2009.

Budget meeting schedule

The City of Gig Harbor City Council will hold two budget work sessions and two public hearings on the 2010 budget. All meetings will be held at 5:30 p.m at the Civic Center, 3510 Grandview Street in Gig Harbor.

Nov. 2 (Council budget work session, rooms A/B)

Nov. 3 (Council budget work session, rooms A/B)

Nov. 9 (Regular City Council meeting, Council chambers)

Nov. 23 (Regular City Council meeting, Council chambers)