Council: Cut, don't raise taxes or fees

Colorado Springs residents might see a drop in services next year to cover a $23.3 million budget gap created by falling sales taxes and expenses the city can't avoid.

"The idea is living within our means," City Manager Penelope Culbreth-Graft said.

Among the City Council-endorsed cutbacks are freezing some employees' salaries, reducing funding for repaving streets by $8 million, reducing bus service, some layoffs and a 9-percent across-the-board reduction for all departments except public safety.

Meeting in informal session Monday, the council was asked by Culbreth-Graft for direction on where to slice to make up the difference between projected revenues of $232.3 million and expenses of $255.6 million.

While the council embraced some of her ideas, they turned away nearly every proposal to increase revenues. Those included parking charges at Garden of the Gods and Red Rock Canyon, keeping a larger portion of the lodgers and rental car tax instead of giving it to the local tourism agency, charging an annual sales tax licensing fee, raising vehicle registration fees and real estate transfer fees.

"We might as well start biting the bullet now," Councilman Randy Purvis said, expressing the sentiment of most council members as they rejected the fee hikes.

Vice Mayor Larry Small predicted a tough year. "We're going to have to share that agony together," he said.

One revenue increase that won council favor was hiring four sales tax investigators to search for businessees that don't give the city what they owe. Culbreth-Graft estimates the new investigators could bring in $2 million.

Small was skeptical, saying that would mean from $80 million to $100 million in sales goes undetected.
"That's hard to believe," he said.

Council members backed layoffs the city manager proposed from a pool of 25 jobs, most of which are already vacant. Culbreth-Graft didn't specify which departments would suffer the losses.

The council rejected $4.8-million in pay raises that would make salaries comparable with other jobs in the market, but employees will still get merit raises, the cost of which was not provided.

Curtailing repaving streets means the city will revert to its 2004 funding level of about $24 million.
Culbreth-Graft predicted a $500,000 savings from a reorganization plan for which she gave no details.

The reason for the shortfall stems from declining sales tax revenues due to a sour economy and expenses the city must pay, some of which weren't anticipated.

Those include: one of three annual $1.75-million payments to settle a federal lawsuit over police overtime, $1.867 million for the United States Olympic Committee deal to secure its headquarters here for 25 years and $1.8 million for rising fuel and equipment.

In addition, the council must pay at least $1.3 million for a transit worker pay and pension hike and rising fuel expense, which the council suggested be offset by a cut in service.

"If the transit union wants that money, let them explain to people why we're having to eliminate routes to pay for that," Small said. "I'm not going to be the one to explain why labor needs that money. They can explain it."

Culbreth-Graft will use the council's input to draft a budget proposal due on Oct. 1.