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Budget crisis slams Orlando
Jul 15, 2008
Socked by state-mandated tax cuts and a tough economy, Orlando's leaders will likely raise property taxes and make deep cuts in services to close a $30.million city budget shortfall.
Mayor Buddy Dyer's top staff presented the grim financial news to the City Council on Monday, rattling off a long list of possible cuts that could affect everything from residents' safety to how often the grass is mowed and potholes are filled. Orlando is among the first Central Florida cities to face raising taxes and slashing services, but it won't be the last. Across the state, cities and counties are struggling with the tax-slashing impact of Amendment.1, which voters approved in January.
Possible cuts in Orlando run the gamut from fewer cops on the street to cutting the number of children in after-school programs and shuttering some community centers on Saturdays.
Commissioners seemed taken aback by the breadth of the reductions.
"Oh, my God. That's just awful," Commissioner Patty Sheehan said. "This isn't fat. This is nuts and bolts of our government. We can't cut these things." But that may be the reaction Dyer was hoping for. At a workshop today, commissioners plan to decide whether to raise taxes to save some of those services. While Dyer stopped short of explicitly calling for a tax increase, he also said he would not cut public-safety spending. He said the only way keep that pledge is to raise taxes.
Commissioners will discuss a possible tax increase today and set next year's maximum property-tax rate Monday.
The final decision won't come until after public hearings in September.
Under state law, a small tax increase can be approved by a simple majority of four of the seven members of the council. But bigger increases would require the approval of a supermajority of five commissioners or even a unanimous vote. If approved, it would be the first time that Orlando's tax rate has gone up in 19 years.
The city's accountants laid most of the blame on Amendment.1, the constitutional amendment backed by Gov. Charlie Crist, Republicans in the Legislature and voters that forced cuts in property-tax collections. Property taxes are the main source of cash that keeps cities, counties and school districts running.
But additional sources of money that Orlando and other cities depend on also have dropped, the result of a slackening economy. Sales-tax collections are expected to be down 7.6.percent. Money doled out to cities by the state is projected to fall by 4.5.percent; user-fee collections in departments such as parks and planning will see a 6.percent decline. And with business growth slow, occupational-license fees are flat.
The city's general-fund budget, which finances most operations, is $341.million this year. Adding in increases in salaries, fuel costs, health-care expenses and public-safety programs, the city would need $374.9.million to provide the same services next year. That's $30.million more than the city is expected to have. Dyer's administration already plans hiring delays and a series of relatively small cuts that city officials say would save $12.million. But that would still leave $18.4.million to be slashed or offset by a tax increase.
Some cuts would go to the heart of Orlando's nickname of The City Beautiful. There could be fewer flowers in parks and roadside flower beds, parks and medians would be mowed less often and maintenance-heavy brick streets would go without repairs.
Dyer inherited a $23.million deficit when he took office in 2003 and cut 256 positions to balance the budget. He said the city has been tightfisted with tax dollars ever since and has already made all the cuts that could be done without much impact.
While the number of police and firefighters has increased, the rest of the city work force has decreased during over the past decade. In 1998, there were 17.7 city workers for every 1,000 city residents. Today there are 14.5 workers.
"It's not small, somewhat painless cuts anymore," Chief Financial Officer Rebecca Sutton said. "To get the numbers we're talking about, it's going to take big cuts."
Where the pain might be felt
Orlando officials Monday identified possible cuts that could make up more than half of the budget gap, including:
$3 million: Delay the hiring of 25 new cops
$8.8 million: Freeze wages
$2.9 million: Eliminate 2 EMT rescue trucks and a fire engine
$900,000: Put police mounted patrol out to pasture
$100,000: Close some community centers on Saturdays
$200,000: Reduce after-school programs and trash collection at parks
$60,000: Close museum on weekdays and eliminate plant purchases at Leu Gardens
$200,000: Reduce or eliminate brick-street rehab
SOURCE: City of Orlando