Bainbridge Island officials are talking about staffing cuts as work continues on the city’s next biennial budget.
Interim City Manager Morgan Smith presented the preliminary two-year budget to the city council last week, and the spending plan includes a 4 percent reduction in staffing that represents the largest cut in employees since the 2011 budget.
In her budget message to the council last week, Smith said existing revenue streams would remain flat while expenses continue to rise.
“Currently, annual impacts of this type generate between $450,000 and $500,000 in new costs for existing services,” Smith said in her budget memo.
“These increases accumulate year-over-year, and so are expected to grow by a larger amount each year,” she added. “This is a fundamental challenge faced almost universally by both public and private sector organizations as medical and pension expenses and general inflation levels continue to rise.”
Personnel costs are expected to rise by 2.7 percent next year and by 3 percent in 2014.
The city’s portion of medical costs for employees who are covered by Regence are expected to increase by 6 percent in 2013; costs for employees covered by Group Health will go up 15 percent.
Benefit costs in total are expected to rise by 6 percent in 2014.
The city is also required to put aside more money in retirement contributions for employees, which will increase costs by $157,000, or 31 percent, in the 2013-2014 proposed budget.
The budget includes a 2.7 percent cost-of-living increase for employees, according to Finance Director Ellen Schroer.
The figure is an estimate, Schroer said, as negotiations continue with both the Bainbridge Island Police Guild and the International Association of Machinists, which represents employees in the public works department, clerical workers at city hall, court employees and non-uniformed workers in the police department.
The guild contract expires at the end of 2012, while employees represented by the International Association of Machinists are working under the provisions of their previous contract.
City officials said the financial outlook of the city will mean “hard choices” as the 20013-2014 budget is finalized before its adoption in November. In her budget memo to the council, Smith also warned council members to stay realistic about what the city can afford to do in the coming year.
“City leadership needs to work together to establish realistic expectations about service delivery and new initiatives. Given our forecasts, the city will be challenged to continue to deliver current services,” Smith said.
“Consideration of new or expanded activities will need to be explicitly weighed against the organization’s capacity to first meet existing regulatory obligations, and to next resolve identified deferred needs,” she said.
Though elected officials, as recently as the council’s July retreat, had contemplated adding new hires to its workforce, including a communications specialist and increased police staffing, the proposed budget shows a reduction in the number of Bainbridge Island employees.
The city is considering cutting positions in the planning department and police department as part of its next biennial budget.
A total of 4.5 positions would be eliminated; three in the planning department, and 1.5 in the police department.
According to the draft budget for 2013-2014, the reductions would mean reduced city services in both the police and planning departments.
If the council approves the cuts, the city will have the equivalent of 103 full-time employees next year.
It will mark the fifth straight year of cuts at city hall; the city budgeted for 152 employees in 2008, 145 in 2009 and 136 in 2010.
The staffing reductions include the elimination of a term-limited associate planner position, and a long-range planning manager position. The division secretary’s position will also be cut.
Eliminating the long-range planning manager and secretary positions will cut $211,000 in salaries and benefits from the budget.
Positions in the police department will also be trimmed. One of two parking enforcement officers will be cut, which represents a budget reduction of $66,000.
City officials said the reduction will mean fewer hours of patrol and enforcement of parking limits, and parking enforcement efforts in the future will be focussed in Winslow.
The full-time position for an evidence technician in the police department will be reduced to half-time, and will result in a budget cut of $33,000.
The general fund — the pot of money that pays for most general government services such as police, planning, public works, administration and courts — is expected to total $16 million in 2013.
On the revenue side, the preliminary budget includes a 1 percent increase in property taxes, plus taxes spurred by new construction.
The draft spending plan does not include any changes to utility rates.
Bainbridge expects to pull in total revenues of $29 million in 2013. It’s an increase of roughly $68,000 from the 2012 amended budget, but also represents a $2.6 million drop from 2011. Revenues include property and sales taxes, fees and service charges, utility charges, fines, assessments and other payments.
Property tax revenues are expected to increase by 2 percent, or $151,000, in 2013. Total property tax revenues are forecast to hit $6.7 million next year.
Sales and use taxes are expected to fall by $130,000 to $2.7 million next year, and the budgeted amount for utility tax revenues will also drop, by $157,000 to $3.3 million.
Other fall-offs include a drop in business licenses, down 19 percent to $181,000 next year, and lower parking fine revenues, down 33 percent to $102,000, prompted in part by the elimination of one of the city’s two parking enforcement officers.
Total revenues are also expected to drop in 2014, down to $28.1 million.
The budget also includes major transportation improvements, such as $1.3 million for the Rockaway Beach Road stabilization project, $990,000 for the second phase of the reconstruction of Fort Ward Hill Road, and $956,000 for road preservation work.
