Akron’s budget looks to go on a diet again this year, with a few less firefighters, a smaller projected wage increase and no rate hikes for sewer and water customers.
On Monday, Mayor Dan Horrigan’s top accountants presented his 2019 spending plan to City Council. The operating budget must be passed by the end of the month, per city law.
There’s little change from 2018 as Horrigan enters the final year of his first term looking to save a bit more and sustain service levels while trimming 13 positions citywide, mostly from the fire department.
Income and property tax revenues are expected to continue a modest climb as labor costs drive up overall expenses, and health care costs, which dropped in 2018, stay largely flat. All told, the 2019 budget allows for the hiring of 1,900 employees.
However, the city typically has around 100 vacancies. It ended 2018 with 1,811 total staff, which is now below 1,800, or about where historical trends say it should stay for most of the year.
The mayor is again promising to hire more safety personnel, but the budget for the police department is down one administrator and there are eight fewer uniformed firefighters and paramedics, bringing budgeted staffing in the fire department from 395 last year to 387 this year.
The fire department ended 2018 with 375 employees, including 352 in uniform. A federal grant supporting 25 of those firefighters expires this month. So, Horrigan’s budget shifts $500,000 more from an income tax passed in 2017 to maintain the payroll.
Last year, council approved a budget that allocated $3.5 million of Issue 4 money (the income tax passed for police, fire and roads). The new tax raises about $15 million annually, most of it going to projects and equipment purchases.
The city’s police and fire chiefs are in hiring mode. The police department is looking to train a 40-unit class this year. Staffing levels are down at the beginning of the year due to retirements, Deputy Finance Director Steve Fricker said.
The biggest bucket
The city’s operating budget includes nearly 50 separate funds, each dedicated to specific purposes.
Think of them like buckets. The $90 million paid by sewer customers fills the sewer fund, which can only be used to maintain and operate the city’s sewers.
Some funds are fed by state and federal grants, others by locally collected taxes and fees. Loans cover shortfalls. Together, the nearly 50 funds take in around $600 million annually. The biggest among them, and the one the city has the most spending control over because it’s mostly fed by income taxes, is the $168 million general fund.
Compared to actual figures from 2018, revenues and expenses in the general fund are budgeted to increase about $2 million each this year. These are just targets, though. Last year, revenues and expenses finished $2 million below expectations.
After first trying in 2017, Horrigan will again attempt to push the general fund’s cash balance over the $10 million mark. Cash reserves on this unrestricted fund (which can easily be used for a rainy day) have increased from $5.2 million to $9.9 million since Horrigan took office in 2016.
Nearly half the general fund supports the city’s $79.8 million in projected payroll for 2019. That’s up from $75.5 million in 2018, largely because of an anticipated 2 percent wage increase for all city employees. That could change, though, as labor contracts that expired in December are still being renegotiated. Wages crept up 2.5 percent in 2018 under the old contracts, which typically set pay increases for nonunion employees, too.
For another year, the budget assumes income taxes will grow by 2 percent. Last year saw a 2.9 percent increase after a disappointing 2017 (down 2.3 percent) and an impressive 2016 (up 4 percent). Property taxes, which inched up 1.5 percent last year (or about $400,000) are again expected to climb.
Reach Doug Livingston at email@example.com or 330-996-3792.