LOUISVILLE, Ky. (WDRB) – To help offset rising pension costs, Mayor Greg Fischer proposed a budget Thursday that would slash hundreds of city jobs, close library branches, golf courses and public pools and reduce funds for Metro government departments and programs.
The spending plan for the coming fiscal year also looks for savings in public safety, although Fischer said the cuts aren’t as deep as they were elsewhere. Still, he wants to close one firehouse, eliminate the Shotspotter gunshot-detection system and ground one ambulance.
Louisville Metro Police would see a net loss of 40 officers under the mayor’s budget, even after moving 17 officers now stationed in Jefferson County Public Schools to patrol duty. The police department would see $5.9 million in cuts.
Faced with increases in state-mandated pension costs, Fischer said he made data-driven spending decisions that took into account how citizens use services, while also continuing to help those in need.
“The priority was public safety and then protecting the most vulnerable citizens and … continuing basic city services,” he told reporters in a briefing Thursday morning.
The city had faced an estimated a $35 million deficit. But the plan put forth by Fischer’s office revised that shortfall to about $25 million, a result of various changes to revenue assumptions, health insurance plans and other factors.
The budget plan has $623 million in general fund spending and overall expenditures of $878 million after factoring in other state and federal revenue sources, debt payments and other grants. Both are lower than budgets enacted last year.
The proposal now goes to the Metro Council, which announced it will hold three public hearings on the budget. Those hearings are scheduled for May 7 at 6:15 p.m.; May 16 at 6 p.m. and May 20 at 6 p.m. at City Hall.
Fischer's proposal has drawn a mixed reaction from members of Metro Council. During a Thursday afternoon news conference, some Democrats and Republicans expressed concerns with the potential cuts to public safety and expressed a desire to tweak to mayor's plan to lessen its impact on vital city services.
"My goal — my only goal between now and June 25 — is to get a budget that as many members of the Metro Council can agree on and that the mayor will sign," Councilman Bill Hollander (D-District 9) said.
Fischer said the $86 million capital budget proposal is the lowest in six years and focuses on maintenance. Even so, for example, there is $3 million less money for paving than in the current spending plan.
Fischer said all city departments were impacted by the cuts, although he insisted the job losses would mostly affect management and supervisory positions and not rank-and-file employees. The mayor’s office would lower its budget by 10 percent, while Fischer said he is donating 20 percent of his salary to the SummerWorks youth jobs program because he can’t take a pay cut under Kentucky law.
The budget, which takes effect July 1, is the first since Fischer warned of an estimated $65 million shortfall in the next four years caused mainly by mounting pension costs. On Thursday, he said last week’s revisions by the Kentucky Retirement Systems indicate the city’s costs could continue to rise even beyond 2023.
“As distasteful as this budget is right now, it’s just the beginning, and future cuts will be much more difficult and felt by many more people and in a much more severe way,” he said.
Fischer proposed raising a raft of insurance taxes to generate more revenue, but the Metro Council defeated that plan last month.
Now, the budget must rely on cuts and spending decisions.
Fischer wants Metro government to save $1 million by closing libraries in leased buildings in Middletown and Fern Creek that are mostly used by people who drive there. Citizens aren’t far from other regional libraries, and a new library in northeastern Jefferson County is expected to open soon, he added.
Meanwhile, the proposal calls for most libraries in Louisville to be open eight hours a day, down from 12 hours now. That would save $1.1 million – while also eliminating 78 jobs, including 48 layoffs.
Fischer also wants to end general fund support for Centerstone Inc.’s “Living Room” program, an alternative to jail or hospitals that serves people with mental health and substance abuse issues. The per-person cost of $500 isn’t worth it, he said.
“We need more return on our investment for that,” Fischer said. He noted that the budget plan includes $1 million for homeless services.
In February, the Fischer administration identified potential cost savings that included eliminating up to 563 positions, with 317 by layoffs. The budget plan calls for 312 job losses and 88 layoffs.
Daniel Frockt, Metro government’s chief financial officer, said the lower figures are the result of several factors, including LMPD cancelling its June recruit class; the city postponing a plan to move Youth Detention Services to state control; and a decision to shut down one firehouse instead of two. Under Fischer’s budget, the Grade Lane firehouse would close, eliminating 15 jobs.
In addition, Frockt said, there’s been an increase in city employees leaving their jobs.
“We’ve certainly seen more resignations and that’s reduced some of what we thought were going to be layoffs, because people have been seeking out other opportunities,” Frockt said.
Since the start of the current fiscal year last July, about 660 workers have left, including about 400 who have resigned, according to Fischer’s office. The mayor said the turnover rate is about 14 percent, while in the past it’s averaged six to eight percent.
Although the council shot down Fischer’s tax increase plan, the mayor is assuming that it will raise property tax revenue by 4 percent allowed by law, producing about $1.2 million. The mayor’s administration expects that, based on assessments, the revenue increase for next year will be 3 percent; the council could then raise the tax rate by 1 percent.
The mayor is proposing moving the Louisville Zoo to an independent operator, a move that could change prices, hours and exhibits; close four of the ten city golf courses; and shut down the Algonquin, Fairdale, Norton and Sun Valley public pools.
No decisions have been made on which golf courses would close, but those under consideration include Charlie Vettiner, Cherokee, Crescent Hill, Bobby Nichols, Iroquois and Sun Valley. It’s possible a private operator could step in and manage any that shut down.
In recent years, Louisville Metro government has set aside public funds as part of private developments, such as the Omni Hotel and Louisville City FC stadium planned for Butchertown. The city also is part of a tax-increment financing deal for the KFC Yum! Center, a state-led project.
Fischer defended those investments during a difficult budget period, saying the city receives a “return on investment” in those cases.
“We’re just not giving money away,” he said. “So whether it’s Omni or job attraction here, the money that goes toward that is exceeded by the return that we get.”
Even though Louisville’s budget is lean, the mayor said, “we’re not going out of business. So you still want to invest to attract the right type of jobs to the community, so that we can grow the overall opportunity we have for our citizens.”