ST. PETE BEACH — A citizens committee will on Monday begin poring over a proposed $15.82 million city budget that has nearly $1 million in red ink.
By the end of the month, the five-member group, formally known as the Finance Budget and Review Committee, will present its recommendations to the city commission, which will then take another month to review the budget proposed by City Manager Mike Bonfield.
In past years, Bonfield presented the commission with balanced budgets, but this year — largely because of soaring police and fire pension costs — he has left the decision to the commission on where to cut or add revenue.
The commission will have to find $939,566 to balance its budget as required by law.
The commission's first public hearing on the revised budget is Sept. 12 and the final hearing and adoption of the new millage rate is set for Sept. 23.
The city has enough in its savings to cover the budget deficit, but using those funds would leave the city potentially without enough money to cover unknown costs of a major hurricane that could happen next week, next month, next year — or not for years.
Another budget balancing option is to cut employees, whose expense is $10.3 million, the largest portion of the city's annual budget. But to do that would require sharp and unpopular cuts in services.
The commission is considering asking voters if they want to close the city's police department and contract with the Pinellas County Sheriff's Office, a potential savings of $1.3 million annually.
But that decision cannot be made until the November election, too late to make any impact on the budget process since the city's fiscal year begins Oct. 1.
Meanwhile, the proposed budget includes a $108,551 increase in operating costs, a $690,986 increase in personnel costs and nearly $242,000 in increased capital spending.
Revenues are expected to grow by less than $100,000, mostly from fees charged by the city for recreation activities and for public safety services at special events.
The good news is the dropping value of property in the city appears to have stabilized, with property tax revenues growing by about $1,100.
Most other tax revenues are expected to drop, however, including utility taxes, franchise fees, emergency medical service funding, grants and fines.
On the spending side, Bonfield is not offering employees any raises — but insurance and pension costs are increasing.
One area of the budget that has grown year over year is legal costs. Just this year, the commission had to transfer an extra $250,000 from its savings to its legal budget to cover lawsuit-related expenses. In the coming year, Bonfield is estimating legal fees will level off.