Council approves 2010 budget despite shortfall
LAKEWOOD – The city’s proposed $95.4 million operating budget for 2010, which dips into the reserve fund to cover a $2.5 million revenue shortfall, won City Council approval Monday.
The expected 2010 shortfall follows on the heels of an unexpected $2.7 million 2009 shortfall that developed when the economic downturn cut deeply into sales tax revenues.
The city’s sales tax revenue accounts for nearly 60 percent of the city’s general fund income.
“The current trend is not the best, obviously,” Larry Dorr, the city’s finance director, told City Council in their budget review study session in August.
The revised 2009 budget anticipates just more than $97 million in spending against $94.8 million in revenues.
The city’s reserve fund stood at $24.3 million at the end of last year. By the end of next year, the expected two-year shortfall will reduce the fund to $19.1 million, according to Dorr’s estimates. That is about twice the amount of City Council’s mandated minimum reserve fund level of 10 percent of the annual budget.
Monday’s approval of the 2010 budget came on a 9-1 vote. Councilwoman Cindy Baroway was absent.
Although Council members Diana Allen and Adam Paul, who serve on the city’s Budget and Audit Committee, expressed some reservations about the 2010 budget projections during the study session, neither mentioned their concerns Monday.
Councilman Doug Anderson cast the lone dissenting vote, but did not address the reason during Monday’s meeting.
“For me the fundamental thing is that we are doing things outside the core responsibilities of what I want to see city government do,” Anderson told the Edge Tuesday. “I want city government to provide police, I want city government to pave the roads. But once you start getting into ‘Should the City of Lakewood be in the transportation business, should the city be requiring people who want to fix their roofs get a permit and all the attending costs of that process,’ you get to the real issues.
“Getting rid of things like that would negate the need to cut into our city’s savings,” Anderson said. “To me, this is something in which grains of sand are added to make a pile and there are enough grains of sand in that pile that I don’t agree with.”
Anderson also objects to City Council’s unwillingness to dig into the line-item specifics of the budget.
“I think Council should be looking at the particulars,” Anderson said. “The particulars are important. I really think that too many people don’t want to deal with the week-by-week details of what city government is doing and what it is spending.”
Dorr told Council Monday that tracking sales tax revenue shows a downward trend, but monthly variations – including up ticks – can be significant, especially during holidays.
The city’s Budget and Audit Committee isn’t scheduled to meet until late January, although Dorr said he could provide updated presentations if Council wants them.
