It’s that time of year again when city administrators will be holding meetings on the budget process. Many of you may not know that the city is facing a financial crisis. Based on information in the City of Lakewood 2007 Comprehensive Budget, the General Fund balance is at an all-time low. The projected General Fund balance at the end of 2007 is only $91,167. This dwarfs end-of-year balances of $971,745, $615,718 and $901,360 for the previous three years, respectively. Projections in this document show that if nothing is done to curb increased expenditures or to generate more revenue, the city will be operating in the RED for 2008.

City administrators are facing some tough realities and have only three options: increase revenues, decrease expenditures or use a combination of both. Decreasing expenditures can come from several areas, including cutting jobs, cutting services and cutting benefits to city employees. None of these options are very attractive to elected city officials for obvious reasons. But without a solid plan to increase revenues, other than raising your taxes again, city officials will have to face this harsh reality. I, for one, would prefer our taxes not be increased. And without any other promising revenue generating ideas, cuts will have to be made. I would like to present some interesting observations that I hope city officials will take into consideration during the budget meetings.

During the period between 2000 and 2005, the cities population decreased approximately 8%, based on U.S. Census information. During that same time, the number of city employees increased 2.3% and city expenditures increased a whopping 29%. In other words, we needed to spend more money and hire more people to service a decreasing population. Doesn’t make too much sense to me! Cutting jobs would be a viable alternative to resolve this issue. In the past, city officials have cut such areas as park maintenance staff. But it appears as though the management positions have remained in tact and that cuts came amongst the “worker bees.” When there are too many bosses and not enough workers, services suffer. Glancing through the budget, it appears as though much efficiency can be obtained by cutting management positions through department mergers. In fact, so much could be saved that city officials could actually afford to properly staff departments with more workers in the areas of greatest need. Better city services make our city more attractive and serve as an indirect method of increasing income and property tax revenue.

Fringe Benefits for city employees, such as health care, retirement programs and whatever else was negotiated with their contracts averaged 35% of salaries paid to these employees. Some departments are over 40% and the highest is 44%. This is far greater a percentage than most people get in the private sector. For example, the company that I work for has an average of 17%. And it’s not uncommon that companies cut benefits instead of, or along with, cutting jobs. I have experienced a substantial increase in my health care and parking costs over the last two years as a result of my employer needing to “tighten up” due to poor economic times. These increased costs have far exceeded the meager “merit raise” limits established by our senior management. Our company also eliminated (health care) retirement benefits. I bring home less money today than I did two years ago; and that includes two annual merit raises. Fringe Benefits have also been cut at companies most of my friends work at; we are ALL suffering a bit.

Someone is going to have to make a tough decision. And it needs to start with the mayor, who has been very reluctant to take anything away from his employees. But isn’t that what a mayor is supposed to do; make tough decisions that have to be made for the betterment of the community? I wouldn’t want to be in the mayor's shoes these days, because it will be a challenge for him. But if I was, I would do the right thing and make the necessary cuts in order to avoid raising taxes. It would be different if we didn’t already pay more taxes than just about every other city in Cuyahoga County. And you can’t squeeze blood from a turnip!