MONROE — With two employees resigning soon, the city could avoid layoffs to deal with a projected $1 million deficit this year.
A senior planner and the human resources director on Friday announced their resignations to take different jobs, City Councilman Mitch Ruth said. Those positions are expected to be left open as the city scrambles to cover a budget shortfall caused by the tough economy.
“While other efficiencies can be found, I don’t believe additional staff cuts are necessary,” Ruth said.
Ruth believes that leaving the two positions open will save the city about $200,000 annually in salaries and benefits.
The City Council on Tuesday discussed options to deal with the budget deficit. City officials are taking actions to reduce expenses such as delaying capital projects and cutting training expenses. A hiring freeze is also in place. And the city is changing the city clerk from a full-time to a part-time position.
The budget discussion is expected to continue over the next several weeks.
Mayor Donnetta Walser said that layoffs are still under consideration as well as other cost-cutting options.
“There are a lot of steps that need to be taken,” Walser said. “We are affecting people’s lives.”
The city’s general fund revenue is expected to be $977,000 less than expected this year, city officials said. That’s about 8 percent of the $12.2 million general fund, which pays for basic services including police. The city’s fiscal year ends in December.
The city’s total budget is about $65.1 million, and there are about 120 people on the payroll, finance director Carol Grey said.
The goal is to balance the budget without raising taxes, city officials said, as the city is preparing what could be a $7 million bond for the November ballot to pay for road projects over the next few years. If approved, the bond will result in property tax hikes for city residents.
The city is facing the budget shortfall due to multiple factors such as high gas prices and the rising cost of medical benefits for city staff, officials said. The city’s projected revenue in sales taxes is also expected to fall this year from $4.4 million to $3.9 million.
The slow housing market is likely to bring down the revenue from building permits by $150,000 this year, Grey said.
The problems could have been worse. A Lowes store opened in late 2007 in a new shopping center along N. Kelsey Street, generating new sales taxes for Monroe. More businesses are expected to open in the shopping center in the near future.
City officials are considering a conservative budget for 2009.
“Some of the decisions we make will affect next year’s budget,” Walser said.
Reporter Yoshiaki Nohara: 425-339-3029 or ynohara@heraldnet.com.
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