How Tempe is balancing a $33.7 million deficit in its 2010-11 General Fund budget

Tempe voters passed Proposition 401 during the May 18, 2010, General Election, allowing for a four-year, two-tenths of a cent sales tax increase that enables the city to preserve essential services such as public safety and recreation programs. Effective July 1, Tempe’s sales tax will go from 1.8 percent to 2 percent, which amounts to about $60 a year for the average household.

Before the General Election, the Tempe City Council divided the $33.7 million budget challenge into three groups. The three categories of items are detailed in a color-coded chart available by clicking on the “City Council Budget Priorities” tab to the right. The categories are:

• GREEN – $10 million in critical public safety items that were taken off the table for elimination. They include DUI patrols, crime investigation and patrol squads, and a Fire Department company, among others. These restorations were made possible by $5 million in employee furloughs, $3 million in renegotiated healthcare costs and $1.8 million in assorted other cuts and revenue-generating ideas, such as eliminating car allowances for upper management and City Council members.
  
  Full-time city employees will be furloughed for 104 hours during the 2010-11 fiscal year. Firefighters will be furloughed for 125 or 146 hours because of their alternative schedules. In many areas of the city, these hours will be taken by employees and managed by their supervisors in much the same way as vacation hours. However, in some city departments, employee furloughs will mean changes that are more visible to the public. For example, the Tempe Municipal Court will be closed the second Friday of each month, beginning July 9, in order to implement furloughs. 
   
• YELLOW – $8 million in items that are restored as a result of the General Election sales tax measure’s passage. The approved additional tax is expected to generate about $8 million a year, meaning that $8 million in reductions previously identified by the City Council can be restored. They include about 71 city positions, including the Police gang squad and narcotics investigation squad, the Fire dive team function, staff and operating hours at the Cahill Senior Center, funding for human service needs and more.
   
• RED – $16 million in cuts and new fees that still must be made, effective July 1, in order to balance the General Fund budget in 2010-11 and beyond. This means eliminating about 113 full-time positions. The number of eliminated positions does not equate to an equal number of employee layoffs, since some positions are currently vacant. The actual number of layoffs will be known in late July 2010.
  
   

Going back in time during this process, City Manager Charlie Meyer submitted his recommended proposal to the City Council in early February. That original plan is accessible to the right under “City Manager Budget Proposal.” It is a prioritized list of recommended revenue-generating ideas and reductions. It is the basis for the current list of City Council priorities.

Going even further back in time to late December 2009, Tempe’s department managers submitted recommended cuts to the City Manager in order to meet their assigned target reduction numbers. The City Manager then used most of their recommendations in formulating his February 2010 proposal. The entire budget process from late 2009 is available by going to www.tempe.gov/budgetplan and clicking on “Fall 2009 Budget Process.”