09-14-09 Common Council Minutes - Laserfiche WebLink

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REGULAR MEETING SEPTEMBER 14, 2009 Councilmember LaFountain, Chairperson, Personnel & Finance Committee, reported that this committee met on Bill Nos. 60-09; 61-09 and 62-09 this afternoon and voted to send them to the full Council with no recommendation. th Mayor Stephen Luecke, 14 Floor County-City Building, 227 W. Jefferson Blvd., South Bend, Indiana, made the presentation for these bills. Mayor Luecke advised that the City’s General Fund budget for 2010 of $61.954 million represents an 8 reduction due to revenues lost as a result of the property tax cuts. He stated that thanks to the Public Safety Local Option Income Tax and federal stimulus funding, the Police and Fire Departments are budgeted at full strength for 2010. The Police department has funding for 260 sworn officers, while the Fire department can sustain 248 sworn firefighters. He stated that the additional funding restores the on-street public safety presence; it allows no room for new operations growth. Collective bargaining negotiations continue with representatives of employees in both police and fire departments to make changes to allow the fund restoration to work effectively to deliver services. He stated that the parks facilities and programs preserved by the Local Option Income Tax Revenue. It enabled the City to keep several facilities open, including the East Race Waterway, both city swimming pools, the Newman Recreation Center, Howard Park Ice Rink, Potawatomi Zoo, and several recreation programs, including learn-to-swim and summer activity and lunch programs. He stated that Neighborhood Code Enforcement Inspectors will be restored to Full-Time in the City of South Bend’s proposed 2010 budget. He advised that Inspectors in the Department of Code Enforcement originally had proposed cutting back to 32 hour work weeks as a way to retain all staff. He stated that during budget hearings priority was given to undiminished code enforcement and led to re-adjust other allocations in order to retain all Code inspectors at full-time levels. Mayor Luecke advised that 56 positions cut for 2010, this is on top of 25 position reductions this year. Since 2000, the City has cut 206 positions or 15 percent of its workforce. He advised that for the second consecutive year, non-bargaining employees will not receive a pay increase. He stated that in 2009, all Department Heads took a 5 percent salary cut as well as himself. He noted that collective bargaining employees continue to receive previously negotiated increases. He stated that the City will make changes in the application of its health plan, eliminating a $500 contribution to a flexible medical spending account for each City employee a $600,000 savings and going to an 80/20 health insurance plan (1.3 million savings.) He stated that despite new Local Option Income Tax Revenue which restored public safety and parks priorities, many City Departments, especially “general government” departments, will experience the full impact of budget cuts originally anticipated before the LOIT. Even with additional revenue anticipated from the adoption of the LOIT, the 2010 budget projects a loss of more than $6 million in property tax revenue; significantly less than the anticipated loss of $22 million without the LOIT. He stated that South Bend’s fiscal challenges, exacerbated by the state’s property tax caps, are no different than other U.S. Cities. According to the National League of Cities report, “City Fiscal Conditions in 2009”, this is “the worst outlook the report has detailed in 24 years.” Mayor Luecke stated that the City will continue to look at new revenue streams and income sources other than property taxes as a way to help the City live within its means in the proposed 2010 budget. th Gregg Zientara, City Controller, 12 Floor County-City Building, 227 W. Jefferson Blvd., South Bend, Indiana, presented a power point presentation. A copy is on file in the office of the City Clerk. Councilmember Varner stated that since the City is not borrowing money at this time is it necessary to keep a AAA Bond rating? He questioned what the cost savings is between AA vs. AAA ratings. He stated that the City needs to increase the tax base and not just in TIF areas. He asked what kind of plans are there to increase the tax base outside of the Tax Incremental Finance areas. 9