City projects $6.3 million deficit this year — not counting loss of state aid, raises
It’s going to be a rough budget year — again — in Lincoln. And there appears to be no end in sight to Lincoln’s budget problems.
The city has a projected $6.3 million budget shortfall right now, and that’s not taking into account the cost of employee pay raises, the loss of state aid and the potential loss of tax revenue thanks to changes being considered by state lawmakers. The city projects that gap will widen to $19 million in five years, if things don’t change.
I filed an open records request last week, seeking to see budget projections the city generates every year. Before Mayor Chris Beutler took office, the projections were released to the press in December. But Beutler ended the practice, saying it caused undue consternation.
As a candidate for the City Council, I wanted to see the figures so I’d know what this city is facing. Before giving the data to me, the mayor’s chief of staff, Rick Hoppe, gave the budget projections to City Council members after their meeting last night because they don’t appreciate learning such things in the press. Hoppe said one council member immediately told a Journal Star reporter, who then asked for the projections, too, which is why you see the story in the paper today.
The data indicates Lincoln will be facing a budget shortfall of up to $10 million — perhaps the largest ever in the city’s history — when other factors are taken into consideration. City Budget Officer Steve Hubka projects a $6.3 million budget gap will have to be closed this year — and that’s not even taking into account raises for most city employees. He included annual raises for just two unions, since they have contracts for 2011-2012. He did include step raises, which employees get if they’re not at the top of their pay range.
That should add a few million dollars to the bill. In addition, the projection didn’t assume the state would cut state aid by $1.8 million — as is being considered. Lawmakers are also considering taking away Lincoln’s right to levy telecommunications occupation taxes — another big hit if it passes.
Hubka’s projections assume city sales tax revenue will grow at 2 percent per year and property tax value will grow .75 percent for three years and then 1 percent.
Hoppe characterized the situation in LJS as “a little bit worse” than past deficits. But he acknowledged the effect of the city using $4 million in one-time funds last year to bridge the gap. He also mentioned the existence of one discretionary fund, an economic development fund called the Fast Forward Fund, which has more than $6 million in it. So get ready to see that fund disappear.
Lincoln has had to close budget shortfalls every year for at least six years — and this year will be no different. Beutler was elected on a promise to fix the city’s structural budget problems, but this data indicates the problem has only gotten worse, not better.
Winterized 
I know how to get more money. Lets hope the state fair this year brings more people to Lincoln so we can get more tax money from the tourism. Oh wait a minute, the mayor and council did not fight to keep the fair in Lincoln. A loss of over $25 million in business to the city each year, thus a loss in tax revenue. Or, maybe stop the Antelope Valley Project until we can afford it. Ah yes,we could stop the arena project until we have the money. We could put the Experian building up for auction and sell it. Block 38, maybe paying over $5 million for the land and selling it for about $500 thousand could have saved us some money if we at least sold it for what we have in it. Do we have all day here? How about the close to $1 billion we still owe on bonds. Now all of these projects are cool and make the city look like we are a first class city, ( which I always thought without all this) just maybe lets pull back a bit, STOP, LOOK and LISTEN to the tax payers. We are broke and are tired of giving you good money to blow and spend on lots of fancy ideas we can’t afford. People, you voted in these clowns, (I did not vote for any of them) they are not listening to us, so lets vote them out.
State Fair’s gone. Arena’s under construction. Next. Please.
Who would reply to someone who hides behind an alias.
At last year’s City Budget hearing a lady making suggestions was chided by a Council member that We’re out of money. Yet each year we keep finding separate sets of millions of dollars in usable discretionary funds. This makes elected officials appear untruthful or ignorant of usable monetary reserves.
Stop the budgetary sleight of hand, the gimmickry and put the cards on the table.
It is very sad to see the city going down the tubes; and the amount of money we owe is scary and the debt goes to our children and grand-childern. I think it’s like buying a house on a credit card. Let’s put a stop to the spending on things we really don’t need .How many 75-year-old water and sewer lines would $250,000,000 redo? Or better yet, what would that do to property taxes? I would like someone to explain to us how tiff works when we have a down turn and property values drop 30%. How does that effect the return, or is just a GIFT to a developer?
6.3 million dollars huh? That’s roughly $17 for every man, woman, and child in Lincoln. How will we ever survive?
That’s also around 1% of Dave Heineman’s $600 million+ budget that barely got mentioned at all last year on this blog.
Deena, Lincoln success cannot be denied…
#1 Lowest Unemployment in the Nation
2nd Angriest City in the Nation
1st in the Forbes Best Cities for New Jobs
5th in the Forbes list of Best Places for Business and Careers.
9th in the Forbes rankings of the Most Livable Cities.
Top 100 in the Relocate America Top Places to Live list.
10th in the Fortune Best Places to Launch a Small Business.
Top 15 in the Next Generation Consulting top mid-sized magnets for the next generation work force.
Top 10 choice by Expansion Management in its list of the Best Places in the U.S. to Locate a Company
10th on the CNNMoney Best Mid-size Metro Areas to Launch a Small Business Start-up
33rd out of 100 MSNBC.com Best Places to Raise Families
20th in the Child Magazine Best Cities to Raise a Family
21st in Women’s Health Best Cities for Women7th in Men’s Health Best Cities for Men
3rd in the Miliken Institute Cost-of-Doing-Business 20071st in the CDC American Healthiest Cities list
9th in the Forbes Most Livable City in the U.S. list
16thin CNNMoney.com Most Affordable Housing Market
13th Best Place to Retire according to CNNMoney.com
Top 10 MSN real estate most livable bargain markets13th in the American Institute for Economic Research for best small metro for college students9th in the Allstate list of safest cities to drive
3rd in the Parents Magazine best city in the country to raise a baby
Cindy, do you really believe all this baloney given to all the media that the local organizations and leaders have given them?
It is all marketing and, if publishers knew the truth, they wouldn’t print it. This placements sell media publications. We have a good city but it is headed for financial trouble.