With the first round of fee increases and service cuts approved, Henderson is ready to take the next step to improve its budget.
On Tuesday, the City Council approved service cuts and fee increases that are expected to add $2 million to the bottom line each year from parks and recreation operations, but city leaders said much work remains.
The city still faces significant challenges with its operating budget and annual infrastructure deficit, which are estimated at $5 million and $17 million, respectively.
Councilman Sam Bateman said Thursday the city needs to find a way to balance the operating budget with current revenues.
“We can’t run another deficit,” Bateman said. “This is the last year where we should be dipping into savings. We just need to see at this point that we’re not pulling out of (the economic downturn) that fast, so we need to do something.”
City spokesman Bud Cranor said the council’s approval — which included increasing aquatic fees and cutting back on recreation center and pool hours — was what the city could do immediately. Henderson staff are continuing to work on additional recommendations from a Special Budget Ad Hoc Committee report released in February, including potential tax increases and a pricing study for parks and recreation.
“We’ll move forward with the more longer-term recommendations from the committee in the coming months,” Cranor said.
A recommendation for the council to approve a 3-cent property tax increase per $100 of assessed valuation has been tabled. However, Cranor said a tax proposal for a 2015 ballot initiative likely will come before the council this year.
The ad hoc report suggested a 20-cent increase to the current property tax rate of 71 cents, which is lower than rates in Las Vegas, North Las Vegas and Reno.
“The next 12 months is going to be rough,” Bateman said. “Regardless of what happens with ballot questions or whatever, there’s going to be cuts. There’s going to be significant ones. I think we’re a year away from where we ought to be.”
City Manager Jacob Snow said residents need to understand that changes must be made to services and what they cost.
“We cannot continue to provide the premier services that we have been providing this community with the limited revenue we face, despite all these cuts we’ve made, (are) making now and will continue to make in the future,” Snow told the council Tuesday.
Mayor Andy Hafen said the City Council understands that some of the changes touch a nerve in the community.
“We’re not trying to pull the rug, so to speak, for our seniors or our children,” Hafen said. “For residents in this community, we’re trying to do everything we can to maintain the wonderful community we’ve had for the last 61 years.”
The city will undertake a comprehensive parks and recreation pricing study this summer to find $2 million in new revenue, with new rates to be implemented in January. The study will include a market-rate comparison and will tackle such questions as whether the city is charging enough for private and regional use.
“The rates should reflect the quality of our facilities and services,” said Shari Ferguson, assistant director of public works, parks and recreation. She added that some of Tuesday’s rate changes could be increased further.
City Council members are not willing to abandon two key senior programs — transportation and Meals on Wheels — or to defer construction of parks that already are on the books, as was recommended by the ad hoc report.
One of the biggest topics of concern Tuesday and at city-sponsored community meetings in April was the future of the senior transportation program, which delivers residents to the Heritage Park Senior Facility for a passenger cost of $1 per round trip. However, the door-to-door service costs the city $236,000 annually for 111 unique riders.
Ferguson said the city will continue to operate the program until a replacement company is found. Henderson currently is negotiating with the Regional Transportation Commission of Southern Nevada and Independent Transportation Network to take over the program.
However, Snow said the city likely will need to continue to subsidize the program to keep the rates low.
Henderson is working on a better cost model for its Meals On Wheels program and will try to develop a volunteer driver program to help defray some of the city’s $350,000 annual cost.
Snow said the nonprofit Henderson Community Foundation is looking to establish a specific fund to which city employees, residents and businesses can donate to help subsidize some senior programs.
As the Sun City developments and other areas of Henderson continue to age, Bateman said, the need for senior services is going to grow.
“These needs are going to increase, and we’re going to have to figure out a way down the road to continue to address what’s going to be an aging population in already a senior group,” Bateman said.
The city is planning to outsource maintenance by September for the majority of its 392 acres of trails and will reassign four maintenance workers to cover the city’s new parks. Henderson officials estimate 215 acres of new parks funded by developers and the Southern Nevada Public Land Management Act will be built in the next five years, and their maintenance will be turned over to the city.
“If we turn down this funding now, as the economy improves, communities will ask for parks, and construction would then require taxpayer dollars,” Ferguson said.
The city is currently negotiating with its six employee bargaining units, which represent about 60 percent of the city’s 1,850 full-time employees.
City officials and a union leader declined to discuss the possibility of additional concessions or an extension of current concessions that have led to what the city says is $49 million in savings since 2009. And it is not known whether the unions will follow the lead of the nonrepresented employees, who have seen their paid-time-off caps frozen for current staff and lowered for new hires starting July 1.
Snow has asked various departments to trim another $5 million from the upcoming fiscal 2015 budget, which will go before the City Council on May 20.
Hafen, on the council since 1987 and mayor since 2009, has seen a cultural shift in the city since the boom years.
“I will admit, in previous years when times were good, that there was not maybe as a hard look at how we were doing business and how we were spending money,” Hafen said. “That has changed.”
Contact reporter Arnold M. Knightly at email@example.com or 702-477-3882. Follow him on Twitter @KnightlyGrind.