But the good times, when it was possible for the city to fund opportunities that came up and have enough remaining for a healthy reserve, may be gone as the city heads into its next two-year budget cycle.

“It’s going to be a difficult close to this biennium, and we are anticipating it will be a difficult next biennium,” City Manager Eric Anderson told City Council members at a budget update Tuesday.

Anderson said the city government’s wide base of income – real estate, sales, business and utility taxes – put the city in a better position than some others. But a weakening economy had hit sales tax collections, meaning revenues are dipping, he said.

The economic forecast has already taken a victim: The council postponed funding for the Museum of Glass that would have provided a truck to carry its mobile hot shop exhibit around the state.

After hearing the economic forecast, Councilman Mike Lonergan suggested that the $100,000 request from the museum be tabled.

“I don’t believe (it) is at the core for meeting our needs. I think we ought to take a close look,” he said. The council voted later that day to postpone funding.

Julie Pisto, spokeswoman for the museum, said the money was needed to match a $100,000 grant. Now that the money is uncertain, museum leaders have to go back to the drawing board.

“We’re disappointed, but we also understand the complexity of budgeting during this economic downturn,” she said.

Pisto said the museum already has received $75,000 total from three separate grants through the city’s Arts Commission Anchor fund.

It’s one of hundreds of potentially difficult decisions the city has ahead. The city has two options, Anderson said: Cut services, lay off workers and wait it out; or tap into money the city has saved that isn’t tucked into the reserve fund. This money, known as the “fund balance,” is enough to buoy the budget for a tough biennium, Anderson thinks, which should be enough time.

“What this strategy does is take advantage of the discipline you’ve had,” he told the council, and without affecting the city’s bond rating, which could have further-reaching financial implications.

Anderson and the City Council will weigh all options over the coming months as they write the next budget.

Tapping into the fund balance doesn’t come without downfalls. For starters, there’s only enough money in the fund balance to hold the city over through the next two-year budget cycle, or until 2011. Anderson said economic indicators suggest that the economy would be on its way up by then, putting the city back on track.

If not, the city would face tough cuts, he said. Council members already voiced some ideas to save money.

Mayor Bill Baarsma suggested that the policy of idling police vehicles, which sometimes are stopped for long periods of time, might waste gas.

“They’re always prepared to move. I don’t know if protocols need to be examined,” he said, to address the use of fuel and the cost.

Councilwoman Julie Anderson, upon hearing the economic forecast, offered to pull a request from the 2009 budget for $100,000 for the “Go Local” campaign to encourage local shopping. Eric Anderson cautioned against removing any requests for funding in the next budget yet, in case the local economy isn’t hit as hard as expected.

The council will continue to consider the next budget in the coming months. On Aug. 19, it’ll receive updated revenue projections, which will help members form budget priorities. During a series of public meetings in late November and early December, council members will hear public comment on the issue.

Niki Sullivan: 253-597-8603

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