Jon Cartu Reports: $29M stripped from Boulder’s budget to cope with COVID cris - Jonathan Cartu - Moving & Transportation Services
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Jon Cartu Reports: $29M stripped from Boulder’s budget to cope with COVID cris

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Jon Cartu Reports: $29M stripped from Boulder’s budget to cope with COVID cris

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Saturday, June 6, 2020

Amid a global health crisis that is draining government coffers, Boulder is reducing its 2020 spending by nearly $30 million, including dozens of layoffs, a hiring freeze and blanket cuts to city departments.

The financial update, to be presented at Tuesday night’s council meeting, also offers a glimpse into the city’s new process for prioritizing spending. Much information is still lacking: Notes to council spanned a scant six pages.

But a look at two departments — open space and transportation — show that how “essential” a department’s functions are did not necessarily correlate to the level of reductions.

Author’s note: This is an incomplete look at priorities and cuts, based on information provided ahead of city council’s discussion and followup questions from Boulder Beat. Answers received over the weekend clarified the process but did not allow for additional questions. More will be revealed in updates to council and through subsequent inquiries.

The all-purpose general fund — and a new, government capital fund spun out of the GF this year — will be slashed by $13.6 million. That includes $4.6 million saved by staff furloughs and layoffs; the remaining $9 million in savings comes from delaying purchases and deferring project starts.

Examples of general fund reductions:
– $1.6M for deconstruction of Alpine-Balsam hospital (will occur in 2021 concurrent with flood mitigation)
– $750K purchase of Police Incident Command Vehicle
– $225K to replace parking pay stations
– $2.7M across all departments due to closures, service reductions etc.

Projections shared last month found that the general fund could be drained by as much as $21 million and the total budget by $41 million. March sales tax receipts showed 5.4% revenue reductions, though government-mandated business closures weren’t enacted until late in the month.

April’s tax report wasn’t prepared in time for notes sent to council ahead of the meeting but will be presented Tuesday. City leaders will also receive an updated forecast from University of Colorado economists Rich Wobbekind and Brian Lewadowski.

Sales tax losses will hit four funds the hardest. For every $1 in retail tax collected in the city, 21 cents goes to the general fund, 9 cents to transportation, 7 cents to open space and 3 cents to parks and recreation. (Boulder only gets to keep 43 cents from that dollar; the rest goes to the county, state and RTD.)

Finance staff are recommending that $3.6 million be drawn from general fund reserves, a pot of money meant to patch in gaps, usually due to emergencies. That will leave the reserves at 17% of the general fund budget. Best practice is to not let reserves drop below 15%; staff want to leave more cash in the pot since the city is prone to natural disasters such as flood and fire.

Other funds have fewer reserves to draw from. All are expected to be depleted, but only open space has reached the 20% golden standard — even the general fund reserves were a half-percentage short of that goal.

Transportation has the smallest parachute of all, with just 5% in emergency reserves, a mere $1.1 million. The transportation fund will have its spending reduced by $2.6 million: $2 million in non-personnel reductions and $0.6 million staff cuts.

Examples of transportation reductions:
– Deferred operations and planning projects such as Stanford/Table Mesa safety study and the tri-annual 2020 signalized intersection level of service study
– Median maintenance decreased 5%
– Route optimization study for HOP expansion and other transit studies

The Open space fund is being cut by $2.3 million: $0.4 million from staff and $1.9 million from services/programs.

Examples of open space reductions:
– Integrated site plans at North Foothills, Wonderland Lake, Gunbarrel
– Regional trail connections at Rocky Mountain Greenway, Eldorado to 
Walker
– Enhancement projects (Four Mile Creek crossing)

Open space and transportation funds reduced their respective expenditures by 8% each, according to city spokeswoman Shannon Aulabaugh.

A new prioritization process, called Budgeting for Resilience, places programs and employees into four categories based on how critical they are to city operations: Essential, Important, Helpful or Amenity. Department leaders were in charge of categorizing expenditures.

Budgeting for Resilience is supposed to guide spending decisions. Yet despite identical cuts, much more of the work being done by transportation was considered essential: 58% of its functions were categorized as such; just 17% of open space’s were.

A further 49% of open space work was defined as important, while 19% of transportation  fell into that category. That still results in a disparity: 77% of transportation is essential or important while 66% of open space is.

It is possible that the earmarking of funds rendered deeper open space cuts ineffective to the overall budget. Nearly all — 98% — of the department is paid for by dedicated sources. Legally, those dollars can’t be used for anything else.

Transportation has dedicated sources of revenue as well. It was not immediately apparent how much, since transportation falls under the public works department and sources are only broken down at the department level in the 2020 budget document.

The discretionary general fund does provide a bit more money to transportation than open space: roughly $650,000 vs. $184,661 in 2020.

Three funds that power parks and recreation were reduced by a combined $5.5 million. It’s unclear how that department’s programs and employees rank under Budgeting for Resilience.

Also unknown is how many workers each department shed in the 56 layoffs announced this week. The city has not yet provided that list.

Parks and rec, the library and housing/human services were hit hardest by furloughs: 83%, 72% and 57% of their…

Jon Cartu

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