Mayor orders cuts

City departments must make budget reductions that average 12.9%, Dixon says

November 15, 2008|By Annie Linskey | Annie Linskey,annie.linskey@baltsun.com

Baltimore Mayor Sheila Dixon ordered city agency heads yesterday to reduce their department budgets by an average of 12.9 percent next year, saying cuts are necessary because the city is entering a period "worse than the Depression."

Dixon's goal is to reduce spending from the city's general funds by $65 million.

"Times are tough," said Dixon, flanked by her agency heads, during a City Hall news conference. "Everyone is feeling the pinch."

The mayor said the city is facing tax revenue reductions as costs of pension contributions, debt and health care are on the rise.

She declined to discuss specific reductions, but she said that all options are on the table, including potential layoffs. Her directive affects only city spending - which is $1.3 billion - not the state and federal funds that Baltimore receives. The city's operating budget is $2.1 billion.

Last month, the mayor snipped $36.5 million from the current year's budget, which took effect July 1, by cutting police and fire overtime and extending a hiring freeze.

She said she might seek more reductions in the current spending plan next month, when she expects to hear whether the state will further cut local aid.

The city's full budget picture could change significantly if the economy worsens or if the local spending reductions trigger decreases in state and federal matching sources.

The mayor said yesterday that she does not know how much in matching funds the city could lose.

"We're going to try to be really creative with that," she said about ways of holding onto state and federal funds.

Baltimore's belt-tightening comes amid similar action by other cities and states. When Maryland cut about $300 million last month, the city was hardly affected, losing $316,000 in health aid and $290,000 in public safety grants, according to figures compiled by Andrew W. Kleine, the city budget director.

Many City Hall officials have worried that the city would see bigger cuts. In recent public appearances, Dixon has said she believes city residents already shoulder a significant tax burden and had shied away from increasing taxes. But during a 6:30 a.m. bike ride yesterday, the mayor said she has reviewed proposals for fee increases; she declined to specify them.

The mayor called agency heads to yesterday's news conference, but none spoke about how to address the budget challenges.

Police and fire union leaders have said their agencies will have to cut spending by about 5 percent.

Robert Cherry, president of the police union, said he is hoping his department has flexibility to negotiate a lower figure.

Reached by e-mail before the mayor's announcement, city fire Chief Jim Clack called budgeting issues "the No. 1 topic of discussion right now" among top officers.

Fire union officials worried that the cuts will mean reductions in service, with Stephan G. Fugate of the fire officers union raising concerns that there would be rotating closures of firehouses. Firefighter union chief Bob Sledgeski said his members would "not raise the white flag" and would fight reductions.

When asked to detail targeted reductions at the largest city agencies, the city's finance director, Edward J. Gallagher, said: "No. ...We have to emphasize that we are not going to interfere with them. We are not going to allow the press to dog them with their budget targets."

The reduction announced yesterday was not as deep as had been expected. Several officials briefed on the mayor's plan were under the impression that all agencies would be subject to about a 12 percent reduction in all funding - not just the city portion. Some agencies, such as public works, receive large portions of their budgets from other sources.

Some City Council members complained yesterday that they had not been briefed earlier.

"I thought that we were working together," Bernard C. "Jack" Young said. "I just think that the leadership of the council should have been briefed."

He said he does not want to see more cuts to police or the Department of Recreation and Parks, which runs youth centers around the city. He reiterated his interest in cutting the Mayor's Office on Criminal Justice, which costs $12 million a year, though only $1.6 million comes from the General Fund. The council must approve the mayor's fiscal 2010 spending proposal, and it can cut from the plan she submits.

Several council members have proposed tapping into the $92.3 million "rainy day fund" that the city sets aside for "budgetary flexibility should material funding shortfalls occur," according to the budget.

Councilman Robert W. Curran has long proposed using 25 percent of that fund to shore up this year's budget.

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