Staff Writer
PRESQUE ISLE — State and local governments across the U.S. are finding themselves under strain, following a year of budget shortfalls directly linked to the nation’s economic problems. The city of Presque Isle is just one of many communities having to find a way to do the same workload with less. Similar to the state of Maine’s budget and municipalities’ statewide, the city’s budget is under financial strain — that, according to City Manager Tom Stevens.
The reasons are similar, according to Stevens, who indicated reduced revenues as a result of a sluggish economy has caused city officials to make deep cuts to an already tight budget.
According to Stevens, the city has already reduced its approved 2009 budget once and may have to reduce it again. Councilors amended the 2009 budget in June, setting the figure at just over $13 million.
“The sluggish economy has resulted in a revenue shortfall of $412,175 that required the City Council to reduce the approved expenditures in June by the same amount,” stated Stevens.
The two major revenue accounts that have seen the greatest decline in revenues are state revenue sharing and excise taxes.
“When the economy declines, revenue sharing funds decline because they are tied directly to spending as a portion of sales taxes goes to that fund,” said Stevens, noting that people don’t buy as many new vehicles during a “recessionary economy.”
To date, Stevens said the city has avoided major reductions in services due to the hard work of all department heads and administrative staff, but many reductions have already been made.
“While major reductions have not been implemented, the city continues to review its delivery of services and is looking at all areas of the budget to save money,” he said.
Stevens credited city officials for their efforts to keep the budget in line.
“They (department heads and the City Council) should be recognized for their hard work in making sure the budget is in balance,” said Stevens.
Various departments continue to provide much-needed services to the community, despite feeling the budget pinch.
“There are two positions at the police department that are open at this point. The city did not hire a proposed shared position for Public Works and the Solid Waste Department. An opening in the payroll office has resulted in the city contracting some of its payroll function. The position of parking enforcement officer will not be filled when the current employee retires. The city also transferred a portion of the park at Arnold Brook Lake to the Star City ATV Club to help cut costs,” said Stevens, noting the most talked-about budget cut involved the decision to discontinue the use of crossing guards.
“The crossing guard positions have not been filled this fall. That was a direct result of a study that indicated very few students at the elementary level actually walked to school. The majority of students today either ride the bus or have parents bring them to school,” said Stevens.
One Council member suggested a group or organization could provide the service.
“A number of organizations — through the schools and in the community — require community service of their members. Someone from such an organization could serve as a crossing guard,” said Councilor Calvin Hall, recalling how he performed a similar task as a student. Hall noted that it would be a win-win situation, with the individual earning recognition for providing a community service and taxpayers not having to pick up the tab.
While the city has weathered the financial storm thus far, Stevens said there is more to come.
Our latest revenue projection is that even with the adjustments already made, the city will need to further adjust its expenses because projected revenues will be about $200,000 short by the end of the year,” said Stevens.
Stevens said these reductions will need to be made up by a collective effort of all departments to ensure that the end-of-the-year budget is balanced, as required by the city’s Charter.
“I expect that in October, City Council will receive a new update of the status of the budget and how it will be brought into balance,” said Stevens. “The economy has certainly provided its challenges the past year or so. It’s up to city officials to do whatever we can to provide services in the most cost-effective manner possible, while holding the budget in line. To do so has required and may continue to require cuts (in services). We just hope the public realizes that without cuts, the next step could be a tax increase.”
