Cuts not as deep as expected in city manager's budget plan

Lynchburg City Manager Kimball Payne says months of preparation, agonizing and cost-cutting have put the city in a better financial position for the coming year than initially feared.

Although Payne’s budget proposal, which was released Tuesday, calls for further cutbacks across nearly all city departments, it does not include some of the most dire possibilities that were under consideration.

The city is actually predicting it will see a small uptick of about 2 percent in general fund revenues, which form the city’s largest pool of money and support most of its departments.

Those increases were generally quickly eaten up by rising costs in areas such as retirement contributions and debt service, but the positive forecast was enough to ward off some of most stringent measures on the table, such as putting a fire engine out of service or cutting funding for local schools.

Payne’s proposal, which will now be the subject of two months of special City Council work sessions, recommends that Lynchburg City Schools get level funding this year. It also earmarks $1 million for repairs to the roof and gym of Heritage High School.

City departments, which are already observing aggressive cost-cutting measures, will sustain further cuts — 5.5 percent on average — under Payne’s proposal. This is compared with a 10 percent cut all departments were required to build into their budget submissions this year.

Individual losses vary by department. Some are recommended to take a full 10 percent reduction, Payne said, but others, such as the public safety division, are marked for minimal changes. Payne has recommended no cuts for the 911 dispatch center, which already struggles with understaffing, and suggested reductions of 2.6 and 3.7 percent for the police and fire departments respectively.

Payne said while forming his proposal he kept in mind what City Council previously identified as it chief priorities — education, public safety and infrastructure — as well as the need to promote job creation and maintain a certain quality of living.

The city manager is recommending some high-profile cost-cutting ideas, some of which were considered and discarded just last year following public protest. Payne’s plan includes:

• Closing the downtown library

• Eliminating the school crossing guard program

• Possibly reducing police staffing in the D.A.R.E. program and Traffic Safety Unit

• Closing the historic Point of Honor house for three days a week

• Closing the Lynchburg Community Market two days a week instead of the current one

• Reducing street sweeping, sidewalk replacement, guardrail replacement and street repaving operations.

Payne did not propose an employee pay cut, a hot-button issue from last year but did recommend eliminating 75 full-time positions. Of those positions targeted, 60 are now vacant because of the hiring freeze that has been in effect, but the remaining 15 are still occupied. Those employees will be given an opportunity to transfer to other open positions within the city. Payne said he was hopeful the plan could be carried out with minimal layoffs.

The city manager’s budget did not include any tax rate increases. The anticipated new general fund revenues come from several areas, some of which have been mentioned in recent budget reports.

They include: a rise in personal property tax following a rebound in SUV and truck values; an increase in ambulance fees received following a switch to a new collection agency; a sizeable one-time payout from Region 2000 related to the sale of the city’s landfill; and the elimination of a refund the city has given to the state for the last two years as part of the commonwealth’s ongoing budget crisis.

The uncertainty of the state budget was a major sticking point in the local proposal. Tuesday was the scheduled deadline for General Assembly budget negotiators to strike a deal, but they failed to reach an agreement. Payne advised that a special $1.5 million reserve be established to deal with any additional state cuts that may be coming.

The tone of Payne’s proposal was unexpectedly optimistic considering the series of somber budget updates and workshops that preceded it. Payne heavily credited the situation to the work done and sacrifices made by city employees, who he said put the city in the relatively stable position it finds itself in now.

“There has been an absolutely extraordinary effort this year,” Payne said. “I can’t say enough how proud I am of the department heads and employees for all they did. It’s been an enormous amount of stress. This had the potential to really damage morale … But our employees kept their heads up and kept looking for ways to save money. They did an excellent job.”

The budget is now in City Council’s hands. Council will hold its first budget work session next week. A public hearing has been scheduled for next month.

Copies of the budget can be found at either branch of the public library or online at www.lynchburgva.gov.