DANVILLE — The first draft of Danville's new general-fund spending plan does not include any cuts in personnel or services, but city administrators will be putting together a voluntary separation package that will soon be offered to city employees.
Mayor Scott Eisenhauer said the expectation is that the city will see some savings by offering some type of incentive package to employees who want to retire or voluntarily leave, because any positions vacated might not need to be filled, could be consolidated with other positions or could be filled with personnel whose total compensation is less.
Eisenhauer gave aldermen an overview of his proposed 2013-2014 budget plan during Tuesday night's city council meeting, including a first draft of a $22.7 million spending plan for the city's general fund. The plan, which anticipates the city barely ending in the black next year, does not include any cuts in personnel or services. It adds no new positions, keeping the city's total number of employees at 254, Eisenhauer said. The budget anticipates a 2 percent average increase in salaries for nonunion personnel, he said. And the plan does reflect some slight reorganization of personnel and departments.
In December, aldermen decided to hold the line on the property tax levy, keeping the proposed property tax rate at its current level of $1.97 per $100 of assessed valuation, but because the city's total equalized assessed value of property is anticipated to decrease again, that tax rate will actually generate less property tax revenue for the city this year. The city is anticipating more than $500,000 less in property tax revenue, and through those property tax levy discussions last fall, city officials talked about how that reduction in property tax revenue would mean personnel cuts in 2013.
And at least one alderman, Rickey Williams Jr., Ward 1, was expecting to see proposed personnel cuts in last night's budget overview.
Williams said this proposed spending plan means the city is "just getting by" financially.
"We need to stop 'getting by,'" said Williams, who added that he was expecting to see some of the personnel cuts that aldermen had discussed in closed session in recent months. Williams said he doesn't necessarily want to see people lose their jobs, but he believes that $500,000 in personnel cuts could be made and that money is sorely needed in other departments, like for street improvements and maintenance. Among the city's roster of 254 employees, including union and nonunion workers, Williams said, there are still unnecessary positions that could be eliminated.
Eisenhauer disagreed and said the proposed budget "trims the fat," and every position is necessary.
Aside from the property tax revenue situation, Eisenhauer said, the city's other revenues are doing well this current fiscal year with increases in state sales tax and state income tax revenue compared with last year's.
Currently, the city's total revenues for this fiscal year are more than $1 million above what was projected; however, expenses are also more than $1 million more than what was budgeted, including overtime that's currently $288,748 over what was projected at this time last year and insurance costs that are more than $450,000 over what was budgeted at this time last year.
In coming weeks, the city council will be discussing the proposed spending plan for the upcoming fiscal year that begins May 1. The council will approve a final budget proposal in the spring.