Las Vegas budget review shows millions more in cuts needed
Las Vegas has cut $115.2 million from its operating budget over the past three years in order to stay solvent, but more cuts are going to be needed to keep balancing the budget in the foreseeable future, the City Council was told Wednesday.
The council saw a preliminary budget outline that projected general fund spending in the 2012 fiscal year at $455 million, a 1.3 percent decrease from the current year's spending projection.
The 2012 budget plan predicts a $7.9 million shortfall, which can be covered by the city's reserves. After that debit, the reserve fund will be $67.3 million, equal to a relatively healthy 14.8 percent of the budget.
That reserve, however, will be "eaten into drastically" in the next three or four years without additional cuts, Finance Director Candace Falder said, because of the health of the general fund's two main revenue sources: the consolidated sales tax and the property tax.
Sales tax revenue is expected to improve slightly in the coming fiscal year to $211.7 million, up from $206.5 million this year. But plunging property taxes more than make up for that gain, dipping to an expected $91.5 million in 2012, down from $102.8 million.
The 2012 plan assumes that concessions given up by the city's four labor unions, including pay and benefit cuts, will be left intact. The city's contribution to the Metropolitan Police Department also is dropping by 6 percent, and that contribution might be cut even more.
Generally, the city's four bargaining units agreed to concessions that canceled raises and implemented pay and benefit cuts. The firefighters union held on to a reduced step raise for eligible employees but also agreed to pay more for medical coverage.
The city would like to cover the $7.9 million shortfall with further employee wage or benefits concessions so that the reserve fund doesn't have to be used.
Las Vegas plans to have a tentative budget ready by April 15 and a budget hearing on May 17 before submitting its final budget June 1. The city's new fiscal year starts July 1.
