2012-2013 Budget - City of Saginaw MI

City of Saginaw –Goals and ObjectivesAmount designated from 2013Approved BudgetCrime and Public Safety Issues $26,590,738Neighborhood Revitalization and City Beautification $11,018,086Recreational Offering and Youth Activities $215,779Maintain and Enhance City Revenue Efforts $97,644Organizational Development $58,163ConclusionAs City Manager, my task is to produce a responsible budget that incorporates long-term financialplanning as part of our immediate spending plan. As with previous budgets, the 2012/2013 ApprovedBudget continues a trend that means perpetual reconsideration of the way municipal services are deliveredand the level of services that can be provided with available resources. Administrative procedures anddepartmental policies are continually being implemented and updated to hold the line on expenditures.The most significant factor in the development of this budget is the level of expected revenue for FY 2013and a drastic increase in expenditures, particularly those related to retiree benefits. Although revenuefrom some general fund sources is expected to increase slightly, the city is projecting to receive fewergrants than in the past, which will put additional strain on the general fund. This will be the second yearof the Economic Vitality Incentive Program (EVIP); therefore, we know what to expect with regard torevenue and the deliverables to the State, however we also know that revenue will be approximately $2million less than when the city received Statutory Revenue Sharing.Retiree benefits have long been an issue for the city, and the rate at which those costs have continued torise is alarming. Pension costs for 2013 have increased by well over $1 million from 2012 expenses, andretiree health care also continues to increase. Retiree health care is budgeted at over $7.5 million in thegeneral fund and general fund pension costs are nearly $10 million – therefore approximately half of thegeneral fund expenditures are dedicated to retiree expenses! This is an area that must be addressed duringfiscal year 2013 in order to preserve city operations.As the city moves into the new fiscal year, managed financial planning will become one of the mostimportant aspects for overall city management. To that end, we must focus on the reduction ofexpenditures throughout the fiscal year; that will include continuation of the 5-Point Management Plan.Recall that the plan includes the following: Review all administrative policies to identify cost savings tothe city; conditional hiring freeze on all vacant, budgeted positions – positions will only be filled basedupon compelling evidence from the requesting department; continued meetings and cooperation with theGovernor’s Office and other State agencies to increase funding for the city; additional discussions withunion leaders regarding opportunities for savings, either through collective bargaining or operations;eliminate paid time off annual accruals that occur in January (this is part of current negotiations with thelabor unions). Our goal will be to provide the same, or even a higher level of service than the city has inprevious years. I believe that this is a realistic goal, particularly with the changes in organizationalstructure that have been made and the management team that is currently in place. As the yearprogresses, the management team and Council must consider the services that the city is providing andlook for ways to deliver those services more efficiently to further enhance savings.As “Collaboration, Consolidation, and Cooperation” is one of the primary ideas in the Governor’s EVIP,we must continue to consider ways that we can cooperate with other local units of government and formcollaborative agreements. This cooperation may not only be required to receive funds from the State, butwill also reduce expenses for the city and other local units. Additional revenues and reduced expenditureswill be critical to the city to maintain an essential level of service delivery to its citizens.7