In future, Lynchburg city manager won't look to pay cuts

Lynchburg’s city manager says he will not propose broad pay cuts again but will instead look to reduce services and eliminate staff the next time budget cuts are needed.

“Frankly, I’m not going through a pay cut again,” City Manager Kimball Payne said last week, referencing the recent controversy over employee salaries. “I’ve learned something from this.”

He added it was time for the city to hold a serious discussion about its priorities and where it might be willing to sacrifice going forward. Those issues are expected to be major topics during City Council’s annual retreat this summer.

Officials expect to end the

current fiscal year on budget after reducing revenue projections mid-stream to account for the growing recession. But they continue to be wary of the future, given the volatile state of the economy and the growing budget woes in Richmond.

Officials suspect they may be asked to return some of their state funding mid-year, a tactic the General Assembly used in 2008 to balance its deficit-plagued budget.

Observing the terms of that earlier mandate, the city is already prepared to pay the state $487,441 during the new fiscal year that begins Wednesday.

If that amount is bumped up, officials say they’ll consider scheduling another round of employee furloughs to offset the loss. They hope to know by January whether that will be

necessary.

By that point, the city should also have a better idea of how successful a one-time retirement incentive offered to city employees this year has been.

A total of 42 staffers are signed up for the program. Once they retire, the plan calls for their positions to be kept vacant for a period, or possibly eliminated, to allow the city to save on salaries and benefits.

The city estimates it could save up to $650,000, but some positions — such as public safety officers — may need to be filled immediately, leaving it unclear how much the program will ultimately save.

Officials plan to evaluate each position individually to determine how it should be handled. Most pending retirements won’t take effect until Dec. 31.

Unlike the school division’s early retirement program, the city incentive was restricted largely to employees already eligible for retirement. In exchange for agreeing to retire by year’s end, employees receive a one-time cash buyout.

City Council is tentatively scheduled to hold its retreat in August or September. At that time, members are expected to put together a set of budget priorities addressing multiple issues, including the debate over pay cuts versus layoffs.

Council narrowly approved a 3 percent staff-wide pay cut earlier this year, but repealed the decision last week after the city’s budget outlook improved.

The pay cut had come to dominate the final days of the budget process when city employees, primarily from the police department, publicly protested the measure.

Staffers were not united on the issue — many said they were willing to take a pay cut to avoid layoffs. City administrators said that was overwhelmingly the feedback they heard during the development of the budget proposal.

“I think it’s unfortunate we got different messages,” Payne said, adding he now planned to focus future cost-cutting efforts on scaling back services and reducing staff.

A few council members expressed support for that plan when they met last week.

“I thought (pay cuts over layoffs) was the best scenario, but I’m kind of with you,” Mayor Joan Foster told the city manager. “I don’t think I’ll ever vote (for pay cuts) again.”

“I’ll support the city manager on cutting people,” said Councilman Ceasor Johnson. “I don’t want to go through this again.”

Johnson added that he was “sick and tired” of being accused of not valuing employees.

Council did not give full discussion to this issue last week. Most members did not voice an opinion.