CDA considering deficit reduction plan
RAY ERKU | Hagadone News Network | UPDATED 3 weeks, 5 days AGO
As Coeur d’Alene stares down nearly a $3.1 million budget deficit for the upcoming fiscal year, city officials spent time Tuesday entertaining ideas on how to soften the blow.
Finance Director Katie Ebner pitched an idea that would slash about $1.16 million from the projected shortfall. Revising the upcoming budget to mainly allow placing certain new hires on hold, deferring a special overlay program and transferring remaining funds from annexation fees to the general fund will reduce the preliminary 2027 fiscal year budget deficit to about $1.92 million.
“The first place we look when we’re starting to shore up the budget are the items that are additions from the prior year,” Ebner said. “So, the question is, can you make it work next year without these positions?”
Right now, the city looks to hire an additional 2.5 full-time-equivalent positions: one building inspector, one HVAC technician and a part-time city attorney. Combined, supporting those new positions would cost the city $275,241.
As it stands, the 2027 preliminary budget also calls for a special overlay program increase of $250,000, while adding two streets/engineering department general use pickup trucks for $110,000 and replacing a recreation department general use pickup truck for $40,000.
To cut costs in next fiscal year’s budget, the city would place these items on hold while it also transfers the remaining $477,408 in annexation fees to the general fund.
“It isn’t a hiring freeze,” City Administrator Michael Dominguez said. “At most, it’s known as a soft freeze, colloquially.”
The temporary freeze is subject to change based on how well the budget does in the future, according to the city.
“Conversations with directors have been had at this point,” Ebner said, noting that suggested potential cost-cutting measures are not arbitrary. “We’ve got to start making these tough decisions, can you operate without that?”
Early last week, city officials first addressed a proposal to implement a 3% property tax increase after discovering the city faces a $3.1 million deficit. Currently, residential property taxpayers in Coeur d’Alene are required to pay $2.57 per $1,000 of taxable assessed value.
If approved, that tax will rise to $2.70 per $1,000 of taxable assessed value. This proposal, with the addition of a possible 3% increase for capital expenditures, means taxpayers would see a 7% increase.
The city is also proposing to take 1% of forgone taxes.
Meanwhile, the city would use $680,532 from its reserves if the budget is revised with deferments.
Total proposed expenditures for the upcoming fiscal year are $155.3 million, with property tax revenue projected at $34.1 million and $127.8 million in revenue other than property taxes.
A public hearing and final action on the upcoming fiscal year budget are slated for Sept. 1.
“If council is interested in cutting our budget,” said Mayor Dan Gookin, “these are the items presented for your decision to cut.”
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