Wednesday, Jul. 01, 2009
City Adjusts as Tax Losses Mount
Fire, Police Need Sizeable Raise to Stay Competitive With Other Cities
By Nicholas Sakelaris
Staff Writer
Southlake hasn’t kept pace with comparable cities when it comes to paying police and firefighters, city officials say.
These salaries currently lag by as much as 7 percent and it could cost Southlake as much as $463,233 to fix it, said Kevin Hugman, director of human resources for Southlake.
"We’ve seen some bigger changes than we thought," said Hugman, looking at the raises given by other cities. "It can affect our ability to hire the best-qualified applicants."
Meanwhile, the city is reviewing a 3 percent step raise for the majority of city employees. Executives will likely see no salary increase, Hugman said.
The effects of the recession became abundantly clear as the Southlake City Council listened to presentations by Hugman and finance director Sharon Jackson at the budget workshop June 23 at the Southlake Hilton Hotel.
About 33 percent of the city’s revenue stream comes from sales tax, permits and services, all of which are vulnerable in an economic slowdown, Jackson said.
Sales tax collections are 4.5 percent below budget and have missed projections in November, December, January and March, Jackson said. That’s about $250,000 shy of what the city expected. The city is combating the problem by regularly meeting with the city’s top retailers.
A slowdown in construction has caused revenue from city permits to fall below projections, as well.
"There’s just not a lot going on right now," Jackson said.
Demand for city services has also declined, dealing another blow to the city’s revenue stream.
The city made budget adjustments in April, freezing positions and more closely monitoring travel and other expenses.
The city may have to make cuts in other areas to fill open positions in the public safety and maintenance departments before the new DPS Headquarters opens in December .
"We basically have three maintenance workers and a janitor," said City Manager Shana Yelverton. "There are some critical positions that we have to make room for."
Council members in Southlake, as in many other cities, will face some tough choices this summer as they prepare the 2010 fiscal year budget. The budget is typically presented to the council on Aug. 15 and the council adopts it in September.
Yelverton said the financial decisions the city has made in the previous years have prepared it for this situation.
The council looked for some positives amid the sour economic news.
"The good news is that you’re not talking about laying off people," said Councilwoman Carolyn Morris.
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