With rising police pension costs and declining tax revenue, City of St. Louis leaders must chop $45 million off the this year’s $453.9 million annual budget.
The prospective cuts, adding up to $59.7 million, include reducing garbage pick-up to once a week, combining training for City firefighters and police with St. Louis County, and eliminating 26 park rangers, contract recreation programs, 30 middle-management positions and cable television.
It would also decrease subsidies to programs including drug courts, Teach for America, ARCHS After School and domestic violence shelters.
The Board of Aldermen met in committee Tuesday for the first phase of discussion, and a finalized budget will be completed by July 1.
At the Ways & Means Committee meeting, items regarding staff cuts, sick leave and overtime got more approvals from aldermen than those dealing with community services – such as recreation centers, trash pickup and neighborhood capital improvements.
Pensions
Currently, the heftiest numbers deal with staff pensions. Barbara Geisman, deputy mayor for development, said $11 million will go towards pension increases in 2011.
“And that’s just the increase – that’s not what we are already paying,” Geisman said. “That’s 25 percent of our problem right there. It is something that a lot of people are desperately trying to get under control.”
The pension increases in the St. Louis Fire Department will be $6.1 million, $3 million for City police, and $1.9 million for the City employee retirement system.
With the State of Missouri controlling the police department, a change to police pensions would require action at the State level. Changes to firefighters’ pensions would require changes in enabling legislation, and City employees’ pension changes require a City ordinance.
All three sets of changes will require time, which means the City may have to cut from other areas to make up for the pensions increases next year. However, budget advisors suggest that employees contribute a percentage of their pay towards the pension increase. All employees, except for the city employees, are currently contributing a percentage already.
Use it or lose it
The city has more control over sick leave, however, and currently City firefighters, cops and employees can rack up sick time and put it towards their pensions. Geisman suggested moving towards the standard “two weeks off” and “use it or lose it” sick leave, commonly found in the private sector. Several aldermen agreed.
“If we went to a paid time-off system, there wouldn’t be any sick leave, but that’s kind of a paradigm shift for all three departments,” Geisman said.
For the police and firefighters, it would have to be negotiated; it can’t just be decided by the City, said Ron Smith, director of operations.
Some aldermen also said that the fire department uses excessive overtime and inefficient scheduling of personnel.
“The complaints I hear is that it is such a nice scheduling, whereby a firefighter can actually work second jobs and still make a nice chunk of change,” said Alderman Jeffrey Boyd of Ward 22.
“We are basically offering incentive to create the overtime,” said Ward 5 Alderwoman April Ford-Griffin. “It seems to be out of control.”
Geisman said she is having a meeting with fire department officials next week to talk about this and other budget options.
“It is one of the more complicated things I’ve ever looked at, and unraveling it is not easy,” she said.
A 10 percent gap
The $45 million budget gap is about 10 percent of the budget.
Making a 10 percent cut across the board would get rid of inefficient fat, said Ward 19 Alderwoman Marlene Davis.
Other aldermen agreed that even if it were 5 percent, starting with an even cut from every division’s budget would be a helpful start.
Budget Division Director Paul Payne said if this were done, it would greatly affect the police department.
Police department and police pensions make up about 31 percent of the general operating fund. That far exceeds any other City expense with $129 million.
In essence, cutting the highest fund receiver by 10 percent would have a greater effect on the police than other departments.
“Then you have to ask yourself, ‘Are they included in 10 percent or not?’” Payne said. “That’s $13 million. With the fire department, $5 million. Are they being treated the same as everyone else?”
“That’s part of making the hard decisions,” Davis said.
Mayor Francis G. Slay does not support cutting police officers, he said in his blog on January 23, but he does encourage consolidating administration functions between the City and the police department, a $2 million saving strategy.
Joining forces with the County police department to have one training center and crime lab are also options. The saving values of these actions were unknown at time of meeting.
“We have a multi-graph (printing) department; it’s a very good department,” Geisman said. “Does the police department need one too? On a voluntary basis we are working with the police department to combine and eliminate some duplicate functions.”
No Love for the wards
Most aldermen were against cutting $7.95 million in ward capital funds for one year, which is the money that the wards get to plant trees, pave sidewalk and make improvements.
Payne said that in times of debt crisis, it is common to put freezes on building projects or capital improvements.
The $7.95 million comes from a half-cent sales tax for capital projects. The wards get half of this revenue; the citywide fund receives 20 percent, major parks 17 percent, and police get 10 percent.
The aldermen were also not prepared to close community recreation centers, decrease trash pickups or cut out cable TV.
“Most juveniles have no place else to go other than the community centers,” Davis said.
Various offices have idle workers because the building industry has slowed, Geisman said. Cutting seven building inspectors is on the table. Eliminating Neighborhood Stabilization officers and ward liaisons could save $1.5 million.
Ford-Griffin encouraged Geisman and Payne to ask the employees where they think the cuts could be made.
“That’s what I do each year,” Payne said. “But the big difference is the magnitude of this year. You are going to have to do a combination of both.”
Some suggestions would bring in savings in the future, but not next year. That includes automated payroll, with a potential $1 million a year savings in clerical costs, said Smith.
Davis said she wanted to see a list of all the employees would take City cars home to county residences and the amount of gas that the City pays for these employees to trek home and back.
Ward 8 Alderman Stephen Conway, who chairs the committee, asked the aldermen to rank the items on the four-page list of “budget adjustment options” on a scale of 1 to 5, to help guide the Budget Division. Aldermen have until Friday to make initial ratings.
The list of proposed budget cuts can be found at www.stlamerican.com.