story by Ryan Saylor
rsaylor@thecitywire.com
What could be the final battle over the proposed FY14 budget is to take place Dec. 3 following a decision by the Fort Smith Board of Directors to bring the original budget presented earlier in November.
The decision to vote on the original budget versus a scenario presented by City Administrator Ray Gosack on Friday (Nov. 22) would eliminate the possibility of major budget cuts or layoffs the city would have faced under Gosack's scenario.
City Director Keith Lau requested scenarios to eliminate $2.2 million from the city's general fund budget after the original budget proposal showed the city spending $47.919 million from next year's general fund while the city will only show revenues of $45.716 million. Part of the difference includes spending money from the previous year's ending balance, usually set at 7.5%.
The resulting scenario that was ultimately rejected Tuesday (Nov. 26) included revenue increases of $508,000 and reductions in spending of $1.695 million, which included eliminating 14 personnel positions and some employee furloughs.
Lau also expressed concern about a projected budget shortfall of more than $10 million
Speaking about the proposal, Lau said he was not happy with the proposals and wanted to have a better estimate of spending each year instead of having unspent funds rolled over into the next year's budget which he said shows the city is still spending more than it will bring in.
Gosack said he and Finance Director Kara Bushkuhl had intentionally estimated revenues conservatively, which consequently result in higher year-end balances.
"If we make an estimate of what we think those (departments) are going to underspend - if we blow that estimate, then we're going to have to lay people off because we will not have the appropriation to get to the end of the year."
Lau was not satisfied and went so far as to call Gosack's scenario "unrealistic," adding that he was "asking (Gosack) to put together realistic options that do include cutting services or increasing revenues or cost savings and expenses but laid out to us where we can see it and this Board can make that decision as to what we're going to do."
"What's unrealistic about it? I've got a lot of department heads sitting out here and I think they'll want to hear what's unrealistic," Gosack shot back. "Is it the revenue increases? Or is the types of spending cuts we've made? Or is it something else we've missed?"
"I don't think it's anything in particular. I think it's the way that it was presented, to be honest with you. And I think there's other ways to cut and I think you can get more creative than just cutting right to the bone and lopping everything off. That's not what I intended to get out of that when I asked for options. If I remember right, I asked for options, not option."
Gosack said he did present other options in the Board packet made available late Friday, which included his recommended scenario and additional cuts or revenue increases the Board could consider.
Mayor Sandy Sanders said he viewed the discussion over the last several weeks as a good basis for giving the city direction with regard to the FY15 budgeting process. It was an assertion Director Mike Lorenz agreed with.
"We need to make a direction of what to do in 2015 and if they (the city's finance and administrative staffs) can look at in early 2014 any cuts to make during the year," he said. "But to go back and (gut) something they've already done is a waste of man hours and labor is a problem already."
With the Board moving the budget to a full vote, Gosack said it was a sign to the community that the city's financial house was in order.
"I'm happy the Board's taken a direction to adopt a budget and give us a financial plan for 2014. I think it's important for the community and the city organization that we have a financial plan adopted in December before our fiscal year begins."
Lau said he did not regret the actions that did nothing to stop the upcoming vote on Dec. 3.
"I have said my peace," he said. "I have made my stand and it doesn't look like I'm getting any traction. But if I get them to look at expenses because of this shortfall in the future, I guess I've accomplished something."