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City passes $28 million budget

Spending may have to be adjusted after state budget passes
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1 city budget # The Auburn City Council approved a $28.3 million spending plan for the city Monday night but will likely need to readjust the budget once the state passes its own. City Manager Bob Richardson said the city’s budget will be valid for 60 days, at which point the council will make adjustments in reaction to what the state budget may take away. “We have a balanced budget, but it’s more of a placeholder until we see was kind of economic environment we’re going to be in,” Richardson said Tuesday. Among other cuts that could affect cities, Gov. Arnold Schwarzenegger has proposed borrowing 8 percent of local property tax revenues, which could take $350,000 from Auburn’s coffers. Revenues for the 2009-10 budget dropped 18 percent over the previous fiscal year, largely due to the slumping state and national economies, the housing crisis and the credit crunch, according to a report to the city council. This has impacted consumer spending, reducing the sales and property taxes the city collects. To make up for revenue loss, the budget reduces general fund spending by $1.6 million (15 percent) with cuts including: -10 percent reduction in salary and benefits for elected officials and management ($150,000) -8 positions eliminated ($480,000) -Deferring the capital outlay program ($314,500) -Eliminating a contract for code enforcement services ($35,000) -Reductions in departmental services and supplies ($390,000) -Unpaid positions, capital cost transfers and position reallocation ($230,000) The city retains $3.3 million in general fund reserves for times of economic uncertainty. 1 city budget # The Auburn City Council approved a $28.3 million spending plan for the city Monday night but will likely need to readjust the budget once the state passes its own. City Manager Bob Richardson said the city’s budget will be valid for 60 days, at which point the council will make adjustments in reaction to what the state budget may take away. “We have a balanced budget, but it’s more of a placeholder until we see was kind of economic environment we’re going to be in,” Richardson said Tuesday. Among other cuts that could affect cities, Gov. Arnold Schwarzenegger has proposed borrowing 8 percent of local property tax revenues, which could take $350,000 from Auburn’s coffers. Revenues for the 2009-10 budget dropped 18 percent over the previous fiscal year, largely due to the slumping state and national economies, the housing crisis and the credit crunch, according to a report to the city council. This has impacted consumer spending, reducing the sales and property taxes the city collects. To make up for revenue loss, the budget reduces general fund spending by $1.6 million (15 percent) with cuts including: -10 percent reduction in salary and benefits for elected officials and management ($150,000) -8 positions eliminated ($480,000) -Deferring the capital outlay program ($314,500) -Eliminating a contract for code enforcement services ($35,000) -Reductions in departmental services and supplies ($390,000) -Unpaid positions, capital cost transfers and position reallocation ($230,000) The city retains $3.3 million in general fund reserves for times of economic uncertainty. — Michelle Miller-Carl