The City of Tacoma will face growing budget shortfalls over the next five years if it doesn’t change its financial ways soon, the city’s top budget official told the City Council Tuesday.
Jeff Litchfield, the city’s interim finance director, forecast a $60 million to $65 million gap in the city’s 2013-14 general fund budget and an $80 million to $85 million shortfall in the 2015-16 budget.
That’s on top of the nearly $12 million deficit the city faces in its current $392 million budget, which must be balanced by the end of the year. The city is hoping federal grants will help patch that hole and stave off layoffs in the police and fire departments.
Looking beyond 2012, Litchfield said the goal is to close the gap between expenditures and revenue in the first year of the next two-year budget. If Tacoma can solve the $30 million gap predicted for 2013 by cutting expenses or increasing revenue, the predicted deficits in future years would shrink considerably.
“A gap of $30 million – it weighs heavy on my shoulders,” Litchfield said.
Salaries and benefits account for about 60 percent of the expenditures in the general fund, Litchfield said.
“I think this is really the heart of what we have to deal with,” Mayor Marilyn Strickland said. “We need concessions from everyone.”
Councilman Ryan Mello said the five-year projections were serious, but he was more focused on the current budget process.
“I don’t put much weight into anything past the biennium,” Mello said.
The city is pinning much of its hopes for fixing the current budget on a $7.7 million fire grant from the federal government. It expects to hear soon whether it will get the money. On Tuesday, City Manager T.C. Broadnax assured the council once again that one way or another, the budget will get balanced.
He also gave the council some homework designed to jumpstart conversations on how to prevent future deficits.
Broadnax asked council members to pretend that the city now spends $10 on major city services ranging from code enforcement to police protection. Each member was tasked with writing a new budget that assumes the city has only $8.50 to spend, showing how they would divide the lower amount among the city’s current services.
“This is a guide to really show proportional preference,” Broadnax said.
Council members also will rate city services on a scale of one to four, one being to eliminate program services and a four to increase services. For example, under “police protection,” council members will rank services such as response to calls, traffic enforcement and gang enforcement.
The council’s ratings and budget exercises will be reviewed at the June 19 study session. After that, the council will bring the budget process to the community during meetings in council members districts. The community meetings will run from June 25 to July 19.
Staff writer Kim Bradford contributed to this report.