Facing flat or declining revenue and doubts about the economy's rebound, the city of Fairview is considering several drastic budget cuts in its proposed budget for the 2012-13 fiscal year.
So what could residents, property owners and business owners expect from the city in the proposed budget, which covers July 1 to June 30, 2013? Fewer employees, minimal parks and building maintenance and the possible end of popular city-sponsored events such as the Easter egg hunt, the chili festival, National Night Out, the Christmas tree lighting ceremony and Big Truck Day.
City Administrator Joe Gall described his sixth city budget as 'by far, the most difficult and gut-wrenching in terms of decision making' during his tenure, noting it required many unpopular decisions.
'I think the core, essential services people expect from the city will be maintained,' Gall said. 'The bottom line is that we're trying to live with the money that's available to us, which is flat or declining.'
The proposed budget totals $17.6 million, a decrease of $1.17 million or 6.2 percent from this fiscal year's budget.
The general fund - which pays for essential services such as police, fire and emergency, parks, planning and the municipal court - is budgeted at $3.96 million, a decrease of 9.4 percent from this year's budget. The city will have to dip into its reserves to balance the budget, as operating expenses will be $5,683 more than the proposed general fund budget.
The city has had to use $600,000 of its reserves over the last three fiscal years to balance the budget in hopes that the economy would soon rebound, Gall said.
The proposed budget has to go through an extensive review process by the Budget Committee and the general public before it goes before the City Council for adoption.
Besides the possible elimination of city-sponsored events, the proposed budget includes the following:
• Less money for parks maintenance, with a focus on mowing and general cleanup;
• No more flower baskets in Fairview Village, which are maintained by the city;
• No more membership in the West Columbia Gorge and Gresham Area chambers of commerce or other regional economic development organizations;
• No financial support for community programs such as mediation, senior services or the Trauma Intervention Program;
• No additional parks planning or construction efforts;
• Elimination of the Parks and Recreation Advisory Committee;
• Elimination of long-range planning projects; and
• The city's quarterly newsletter, which is mailed to all residents and businesses, will be included with utility bills as an insert. (The newsletter used to be monthly until it was reduced to quarterly in 2009.)
The budget funds a total of 36 full- and part-time employees, putting the city's workforce at the same level as it was for 2003-04. The Public Works department will cut three full-time employees but create one new full-time position to provide a combination of services.
Gall said the general fund will remain flat for the next three to five years because of expected declines in property tax revenues. Fairview's property tax values increased by just 2.1 percent, although it has averaged 3 percent in past years.
'As long as the housing market continues to decline in the Portland area, our revenues will continue to decline,' Gall said.
Fairview's share of revenue from the state is also flat, as the U.S. Census reported a population decline of 820 people in the city.
Other costs affect city
Other factors are playing into the city's stretched finances.
Fairview's contract with Gresham Fire and Emergency Services will be up for renegotiation in 2015. The contract's cost increases 4 percent each fiscal year.
The city is also expecting a 5 to 6 percent increase in rates to the Public Employee Retirement System (PERS), beginning July 1, 2013, which will cost the city more than $100,000. The city is also negotiating with the Teamsters union.
Medical insurance rates are not expected to change, but Gall is proposing that city employees begin a 10-percent cost share for their health insurance.
Police officers are the only employees who will see a Cost of Living Allowance increase because of a labor agreement that's in place, Gall said.
The city's proposed budget is available to the public at fairvieworegon.gov and at Fairview City Hall.
Few signs of economic recovery
There are signs that the economy is improving, Gall said, noting that business income taxes and fees from building permits are up. However, it may take years before the city government sees the benefit, he said.
'Our situation in Fairview is not unique compared to other Oregon cities,' Gall said. He cited a January 2012 study from the League of Oregon Cities that describes how Oregon cities are struggling with funding quality-of-life programs such as social services and libraries.
'In some ways we're better off, and in other ways, maybe not as good,' Gall said.
Fairview's budget process
The city of Fairview's 2012-13 fiscal year budget covers July 1 through June 30, 2013. The proposed budget will be presented to the Fairview Budget Committee, which will meet at 6 p.m. Mondays on April 16, 23 and 30 at City Hall, 1300 N.E. Village St.
The Budget Committee - composed of the mayor, city councilors and seven appointed residents - will review, possibly revise and recommend the budget for adoption by the City Council.
The committee's meetings are open to the public, and residents are invited to share their opinions during the public hearings.
The City Council will vote to approve the budget at a future meeting.