The city of Albany weathered the 2008 recession largely because it had substantial reserves, and now, with another recession possibly looming, it's time to hunker down, City Manager Peter Troedsson says.
During a two-hour presentation Tuesday night to the city's Budget Commission, Troedsson walked the committee through the city’s proposed budget for the two-year cycle beginning July 1. This is the first time the city has produced a budget for the biennium.
The proposed budget, which totals $345 million in all funds and about $86 million in the general fund, includes cuts to emergency services, the library and employee health insurance, as well as the closure of Maple Lawn preschool. Costs are outpacing revenue, Troedsson said, and the proposed budget is the result of months of staff work to find areas to cut.
“A recurring theme throughout this budget is the effort to try to avoid layoffs,” he said.
A part of that was addressing the reality of an increase in Public Employee Retirement System costs.
"They're up to about 33% of our wages and salaries costs. They were about 27%, so there was a 6% increase," said Finance Director Jeanna Yeager. The cost of providing health insurance to city employees is going up 17.8%.
The cost of providing insurance to firefighters, however, is only going up 4%, and that, combined with other cost savings, has reduced potential cuts to the Fire Department.
During an earlier meeting of the Budget Commission, Troedsson outlined Fire Department cuts that included the elimination of the department's technical rescue team that specializes in unique rescue operations, laying off six firefighters and freezing two other positions. On Tuesday night, he said the savings in health insurance costs would amount to $400,000 and that a change in payroll software saved an additional $75,000.
“These changes resulted in reducing the potential department layoffs from eight down to four,” Troedsson said.
Troedsson told the commission that he would begin making the case for additional revenue at Wednesday's meeting of the Albany City Council.
“We’ll propose fee and rate increases that would provide some additional funding,” Troedsson said. “Increases to ambulance service and fire and life safety fees would bring in an estimated $880,000 of new revenue over the biennium. These revenues would go to the general fund, and if council elects to approve the increases, we will use them to avoid layoffs.”
Troedsson said avoiding layoffs was particularly crucial in public safety and emergency services, citing an increase in the city’s population and the subsequent jump in calls for service. The Fire Department already has responded to nearly 10,000 calls this year.
“We have concerns about our ability to respond to all calls,” he said, noting cuts to the Albany Police Department as well.
In year one of the budget, the Police Department will freeze one police lieutenant position and three officer positions either through leaving unfilled positions empty or planned retirement. In year two, an additional lieutenant position and two officer positions will be frozen, bringing the number of sworn officers to a 15-year low of 58. The street crimes and traffic units will also be disbanded.
“The department is fortunate to be able to avoid layoffs,” Troedsson said. “However, it’s important to recognize the impact of freezing these positions.” He said vehicle collisions had decreased with the help of a dedicated traffic officer and the street crimes unit focused its efforts on reducing the number of drug and property crimes.
“Reducing the number of police officers will potentially have several effects,” Troedsson said. “Fewer police officers will restrict our ability to be proactive. There is a potential that response times may increase and there will be less flexibility for officers to take personal leave.”
Troedsson said it was also important to remember that once police officers are cut, it can be difficult to increase sworn officers again due to the year-long training officers must complete before being able to work alone.
Residents wanting to speak before the commission waited two hours to offer comments on the budget's proposal to close the Maple Lawn preschool. The school is part of the city’s Parks and Recreation Department, which would see a deficit of $1.259 million if it provides current service levels into the next two-year budget cycle.
Troedsson told the commission that the Greater Albany Public Schools had shown interest in saving the school, but it depended on state funding. A nonprofit organization, the Oregon Child Development Coalition, has also contacted the city in regard to Maple Lawn. Troedsson said a representative of the organization expressed an interest in visiting the school in the near future.
The uncertainty, however, had parents speaking out passionately at Tuesday’s meeting, noting that the short notice of the closure left children with few options given enrollment deadlines. Moreover, Maple Lawn is one of the only preschools in the area to serve children with special needs.
The budget commission is set to meet again Thursday, but no spoken public comments will be accepted. Instead, written comments can be emailed to firstname.lastname@example.org.
Residents can view the hearings live on the Albany Public Access channel on Comcast Channel 28 in Linn County and Channel 23 in Benton County.