Marana expects to have at least $2.4 million less to spend in fiscal 2010-'11 than it counted on for the current year's budget.
The figure may be higher, Town Manager Gilbert Davidson said in an interview, "on the magnitude of $3 million to $4 million." The higher sum factors in "the uncertainty with the state" and its sharing of revenue, as well as sales tax projections.
The Marana Town Council has instructed Davidson not to seek higher sales taxes, higher fees or property tax revenues, and to protect Marana's reserves, positions made clear at a February council meeting.
"The direction we've been given is 'let's not look at increasing revenue, let's not put the burden back on the individual citizen,'" Davidson said after that Feb. 9 meeting.
That means Marana must cut its spending, a year after it reduced its general fund spending by 19 percent, or some $7 million, to a 2009-'10 general fund spending plan of $30.47 million.
With the council's direction, "it's a pretty simple equation," Davidson said.
"But it's not simple to solve," public information officer Rodney Campbell added.
"We've got our work cut out for us," Davidson acknowledged.
To begin that work, the town council has approved an expanded voluntary severance program for its employees, to now include sabbatical leaves (see related story).
Cuts won't be made across the board. Each town department has "a different budget situation," Davidson said. "Ten percent to one department could be absorbed without too much impact. For another, you could have major disruption to the function they provide to the community."
That said, "every department will keep contributing, and help share in this responsibility," Davidson said. "I don't want to send the message" that a department is immune from reductions. That includes the town manager; Davidson, and others, have given up their town-funded cell phones, relying instead on their personal devices. That will save the town at least $24,000 a year. Fleet management savings, the holding of seven employee vacancies without replacements, and technology consolidation are adding to the immediate savings.
"We want to spread this budget challenge across as many areas as possible, without decimating the many wonderful services we provide," Davidson said.
Davidson has scheduled community meetings on the budget situation (see related story), and he's gone to homeowners associations and "any group willing to listen," telling people "what we're facing.
"We've gotten some good thoughts and ideas," Davidson said. People are "sympathetic, and certainly very much aware" of Marana's budget straits.
Davidson wants the public's involvement. If a program is in jeopardy, he supports "letting those constituents know the service is going to be ended, or if you want to continue the service, the true cost will be X," he said.
He has his direction from the council, and its offer to help with decisions.
"My job as the town manager is to make sure they have as many choices, as accurate information as possible, to make an informed decision on behalf of the community," Davidson said. "It's their choice."
"If you want me to just come back with a budget, I don't think you will like the recommendations," Davidson told the council in February. "Cutting out $4 million is going to be cutting out huge chunks of personnel and programs," regardless of whether council or staff makes the cuts.
"This year is the year we're going to have to make some of those choices we absolutely did not want to make last year," said Councilman Jon Post.
"There will be impacts to personnel, there's no question about it," Davidson said. "There will be impacts to services, no question about it."
"I appreciated the concessions the employees made" a year ago, saving the town's budget some $500,000, Councilman Russell Clanagan said. "I hope you don't close the door, you and staff, to come up with solutions and recommendations. We are a part of the solution. We are not saying 'you figure it out and come back.'"
But, he added, "we cannot maintain these levels we had in the past."
Mayor Ed Honea said the state of Arizona is "probably going to come after us, and not just us, every city and town in the state," the mayor said. "Basically, Arizona is bankrupt. … It might mean closing the senior center, eliminating the parks programs completely. That's the kinds of decisions we're probably going to have to make."
"We had additional options last year," Davidson said. "We had not dug into the budget. We have dug in so much further. Those options are gone. Now, we have to do really creative things, and try to minimize the personnel impacts as much as possible."
Town adds sabbatical leave to expense reduction options
In an effort to reduce its spending, Marana has added an employee sabbatical leave program to a pair of voluntary reductions offered to town employees.
Suzanne Machain, Marana's director of human resources, told the town council on Feb. 9 that the town's voluntary "separation incentive plan" and "worker recession assignment program" had been modified to reflect "lessons learned from last year."
Between March 1 and April 30 this year, regular, full- and part-time classified and unclassified employees may choose voluntary resignation or retirement. The election period is longer than that of a year ago, when 20 full-time equivalent people chose to leave.
People who separate between July 1 and Sept. 30 would receive 100 percent of the incentive package — a 50 percent payout of sick leave balances, a 100 percent payout of vacation and compensatory time, life insurance at the town's expense for one year, a $150 medical plan subsidy for six months, and severance pay based on years of service and annual salary, capped at $50,000.
Those who separate between Oct. 1 and Dec. 31 would receive half those benefits.
Marana has 67 employees "eligible for a retirement, one way or another" — six eligible for normal retirement, 13 who are eligible to receive Social Security benefits, and 48 who could take early retirement, Machain said.
In the new sabbatical program, people are allowed to take time off without pay in 30-day increments up to 180 days of unpaid leave. They would maintain and accrue benefits. No holiday pay is included.
Again, the election period is March 1-April 30.
Sabbatical leave employees may not be subject to any mandatory pay reductions, except in the case of lay-offs. Sabbaticals may not result in additional costs to the town, and the government's operating needs must be met.
This year, the worker recession assignment program, known as WRAP, applies to classified employees only. In that offering, employees are allowed to move from their current positions to an essential vacancy, with their previous jobs absorbed.
Marana slates public forums on its budget
The Town of Marana is holding two open houses for public comment as it starts planning its fiscal year 2010-'11 budget.
Forums are being held this Wednesday, Feb. 24 at 6:30 p.m. at Twin Peaks Elementary School, and again Wednesday, March 3 at 6 p.m. at the Heritage Highlands Community Center. Twin Peaks is located at 7995 W. Twin Peaks Road and Heritage Highlands is at 4949 W. Heritage Club Blvd.
Next fiscal year's budget "is expected to be a challenge with anticipated reductions in money the town receives from the State of Arizona and from different types of sales tax," a release said.
"The town must make decisions about what level of services it can fund when less money is coming in," said Town Manager Gilbert Davidson. "It's important that council and staff receive comments from citizens as the town begins to create a budget for next year that includes the services that reflect community values."