State budget cuts and a grim economic climate have forced the City of Auburn to consider laying off seven employees.

Layoffs affecting the city Airport Manager Jerry Martin, Senior Accounting Technician Elisabeth Davis, the city’s lead custodian, custodian, senior building inspector, office assistant and facilities maintenance worker are being proposed and, if approved by the City Council, could take effect March 28.

City Council members also voted 3-0 Monday night to make public a two-year retirement service credit, which is just part of an overall severance package city officials are preparing that should be ready by the end of the month, said City Manager Bob Richardson said.

Councilmembers Bob Snyder and Bridget Powers were absent.

Eight employees are currently eligible to participate in the incentive program, which city officials said would cost the city about $276,000 up front, but could ultimately save the city roughly $640,000 a year if all eligible employees participated.

Richardson said before the meeting Monday, that the consideration of layoffs came as a result of several economic factors.

“The first thing is a structural financial issue that the city has struggled with for a couple of decades,” Richardson said. “This was an issue we knew was coming and prepared for, however, at the same time, we are feeling the effects of an economic downturn and the state is shifting its budget problems to the cities, which required the need to take action.”

Richardson said city officials have been bolstering reserves for years and cutting back on expenditures in anticipation of the city’s structural financial problem.

“If there wasn’t the issue of the state and overall economy, the city would have been prepared to handle our structural problem much more effectively,” Richardson said.

Martin told the council during Monday’s meeting that he has been given a termination date.

“I’d like to confirm publicly what I was told privately,” Martin said. “I was informed by the City Manager that my position had been eliminated. I was not consulted — I was given a termination date and told when my last day of work would be.”

Davis said she has been working for the city for more than 15 years and was planning to retire in a few years, but is now in a difficult position.

“I don’t really have a choice,” she said. “A two-year retirement incentive would be nice, but I am going to lose two years of health insurance and two years of wages. I am a little puzzled for having worked here as long as I have. We were basically given our walking papers and told to go away.”

City officials are still assessing the financial impacts the state’s budget will have on Auburn’s economy.

“It appears to be getting worse with time,” Richardson said. “We are preparing a reorganization plan for the council and prioritizing service levels to be provided and basing them off of a three-year financial plan.”

Richardson said there will have to be some service cuts, but that he and city staffers are focusing on prioritizing the services in order to maintain them at high levels.

All three councilmembers present issued their sympathy to those who may be affected by the layoffs

“There are certain times on the council where we have to make heart-wrenching decisions,” said Mayor Keith Nesbitt. “This is one of those times. This affects people. On paper, we are eliminating positions, but in reality we are dealing with people. I apologize that we are in this position, but we are and we were elected to make these difficult decisions.”

The council is expected to vote on the plan, which includes the layoffs, at its March 24 meeting.

In other business Monday night, the council voted 3-0 to deny an appeal of a recent City Planning Commission’s decision to approve a 15-foot rear yard setback variance for a 1,680 square foot addition to a residence on Floradale Lane in Auburn.

A 25-foot setback is usually required in single-family residential zones, but according to city staff reports, a building permit for the property was issued in error.

The appellant, neighboring resident Tammy Forrest, requested three conditions of approval to which the applicant, Jeffrey Hayes, said he could not comply with.

While she was present at the meeting, Forrest did not comment to the council on the appeal.

The council also voted unanimously to adopt an annual General Plan implementation work plan and housing element progress report for 2007 and directed staff to submit the plans to the state office of Planning and Development and the state department of Housing and Community Development.

The Journal’s Jenna Nielsen can be reached at jennan@goldcountrymedia.com or comment on this story at auburnjournal.com.