Date:

January 14, 2002

For More Information Contact:

Diane Gonzolas, Citizen Information Center, 441-7831
Steve Hubka, City Budget Officer, 441-7698

Mayor Don Wesely today outlined additional cost saving measures being implemented due to revenue shortfalls caused by slower than projected sales tax collections. Sales tax revenue makes up 43 percent of the tax-supported budget. So far this fiscal year, which started September 1, sales tax collections are $1.17 million less than projected. "Since the start of the fiscal year, we have taken action that sets aside almost $5 million in city funds to cover this year's potential shortfall," said Mayor Wesely. "As a result, the city continues to be in excellent financial shape. We have every confidence that the general economy will turn around. With sales taxes not meeting projections, however, we must be fiscally cautious and look for cost savings while maintaining the important services we provide to the citizens." The belt-tightening actions Mayor Wesely implemented are outlined in a memo to city department directors and the City Council. Department directors are instructed to:

• Delay Capital Improvement Program (CIP) projects funded through the general fund by one year. Mayor Wesely put a majority of the current year CIP projects on hold September 26, 2001. He is now directing that those projects on hold be submitted as CIP projects for fiscal year 2002-03. CIP projects slated for fiscal years 2002 through 2006 are to be moved back one year.
• Eliminate discretionary travel for all employees. Exceptions will be considered for necessary employee training and for travel in which there is no city expense.
• Review all budgeted capital outlay items in tax supported and tax subsidized funds to see if they can be eliminated, delayed or funded over several years.
• Identify at least one significant program, service or function in their department that could be eliminated if further cuts are necessary.

Exceptions to the directives will continue to be considered in cases where funding shortfalls would create problems with matching funds or have a negative impact on city services or economic development.