After its first day of budget hearings Thursday, the City Council Finance Committee is $7.2 million further from a balanced budget, $5 million of it from an accounting error by Mayor Alvin Brown’s budget team.
City Chief Financial Officer Ronnie Belton said the $5 million mistake in Brown’s budget was the result of a missed step when calculating state revenue sharing from the 6-cent sales tax.
Brown proposes a $945 million general fund budget for fiscal 2012-13, which begins Oct. 1, down 1.4 percent from the $958 million budget this year.
The $5 million error was found during the Council Auditor’s Office review of Brown’s budget, which was released last month.
“It got overlooked, it’s just as simple as that. We missed it,” Belton said after the morning portion of Thursday’s meeting.
Belton said he was reviewing potential ways to absorb the $5 million hit and asked to meet today with Council member John Crescimbeni, who chairs the committee.
When Crescimbeni asked Belton if he had any budget ideas during the afternoon session, Belton said “not yet.”
“Disappointed, discouraged. I just want to make sure the mayor has a solution for that,” Crescimbeni said of the $5 million hole. “These are their mistakes. They’re going to have to come back here with a plan to offset those mistakes.”
In addition to the $5 million mistake, a posting error consisting of a misplaced decimal point also resulted in a net $990,000 loss.
The committee also went with auditor’s recommendations to alter water and sewer revenues and JEA franchise fees, which resulted in a decrease of another $360,781.
Council Auditor Kirk Sherman did have some positive news for the committee about potential revenues in areas he had previously questioned.
Sherman said the budgeted $5 million boost from additional fire and rescue runs “appears that the number is probably attainable.”
He said the $1.7 million proposed projected revenues from fire inspections would need more research.
He also said that the projected $1.5 million in red-light camera revenue also “seems attainable unless we have some glitch with it.”
Current legislation would allow for an anticipated 25 traffic infraction detectors that could be in operation in 4-6 weeks after approval, Sherman said.
Belton and Glenn Hansen, City budget officer, presented their overview of Brown’s proposed budget before the committee began its review. Both said the City’s increased pension contributions proved to be the biggest challenge when creating the budget.
Hansen said the administration had to base its 10-15 percent budget reductions on controllable costs, such as salaries, training and personnel, to reduce its bottom line.
“Final reductions in a situation like we did this year are never easy,” Hansen told the committee. “People are painfully aware of the fact the only way is a reduction in force. It’s a very painful and difficult thing to do.”
As proposed, the City’s employee cap number in the general fund would be reduced by 445 positions, which includes 154 from the Jacksonville Sheriff’s Office. Including the City’s subfunds, a total of 510 positions have been proposed for elimination.
The Sheriff’s Office reduction does not include the department’s “lapses,” the term used to account for the total number of budgeted employees not being with the department for the full fiscal year.
If the majority of the lapses were made “real” — indicating hard numbers, which Sherman has advocated for across the budget — the Sheriff’s Office layoffs would be higher and the total City employee cuts could be more than 700 people.
“You cannot leave it in place. You need to interact with him (Sheriff John Rutherford) and determine what needs to be cut,” Sherman told the committee.
When Hansen was asked about his three biggest budgetary concerns, the Sheriff’s Office budget was No. 1, followed by the revenue lines and $5 million error and then a narrow capital budget.
Hansen said “to the best of his memory,” and with the exception of some constitutional officers, all the large City departments achieved – and some exceeded – the 10-15 percent reductions.
Brown has said such departmental reductions were part of the second phase of City reorganization.
Throughout the day, several discussions arose that were similar to those in past budget years.
Chief were the City’s internal revenue services charged to departments for work done within the City and garbage tipping fees charged to the cities of Atlantic Beach and Neptune Beach that could generate revenue of $600,000 but have not been billed because of a dispute.
Both issues will be revisited during Finance Committee meetings about the budget during August.
Paying for items with cash instead of relying on the City’s banking fund, a term dubbed “paygo” by last year’s committee, also was discussed.
Council must approve the budget no later than Sept. 30.
The committee meets 9 a.m.-1 p.m. today.
Topics for review include the Police and Fire Pension Fund administration, Downtown Vision Inc., the Human Rights Commission and the Office of Ethics, Compliance and Oversight.
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