The city of Erie’s budget could face a deficit of more than $1 million before the end of the year. The budget for 2018 is just over $79 million, so the city says the shortfall is still within a manageable range.
The city of Erie’s budget could face a deficit and that worries some like Erie City Council Vice President Jim Winarski. Winarski says the “cost of doing business in this city is not going down; it’s going up, fees are going up.”
Mayor Joe Schember presented the Mid-Year Financial Report to City Council on Wednesday. He says a big part of the shortfall is $900,000 fewer than expected from sewer revenue. “The decision was made, of course, before I was in office to set the budget, but what I’ve kind of heard mumblings of is that some of the surrounding municipalities ended using less of the sewer service than what was anticipated.”
The city says most of the remaining losses come from overtime due to an unusually harsh winter.
Winarski says, “Sometimes things are hard to predict. You go by what we’ve had in the past and what we look forward to in the future.”
While city leaders say they’ll look to make cuts where possible, they say there is money set aside for situations like this. Schember tells us, “…we feel comfortable that we’ll be able to cover this deficit without doing any damage to the city’s credit rating or the overall situation.”
The city reserves a total of $12 million in case of a situation such as this. Winarski says, “Personally, I wouldn’t have a problem tapping into to a certain extent if it keeps the burden off the taxpayers.”
And, part of keeping the burden off means efficiency. Schember says 87% of the city’s budget consists of salaries and benefits. “So, I asked if anytime we have an employee leave for any reason for retirement or if they’re just leaving for another job or whatever, let’s take a look at it and see whether we really need to fill this position.” The mayor says holding off on hiring could save the city as much as $80,000 for some positions.
Schember says they want to get this year’s budget resolved and they present a 2019 budget to council in mid-November.