Franklin orders employee furloughs due to falling revenues
November 12, 2008 at 7:07 pm by Scott Henry in NewsShirley Franklin finally used the “F word” today in the face of a bleak city revenue forecast.
Unfortunately for municipal employees, that word is “furloughs.”
Starting next month, through the end of the current fiscal year next June 30, all city workers – including police officers and firefighters – will have their work weeks trimmed by four hours. Department heads and managers will be responsible for determining how to reduce staff hours by 10 percent without slashing city services, Franklin announced at a hastily called afternoon press conference.
Still, the mayor conceded, the cutbacks likely will have “some implications” for services.
Franklin’s actions came in reaction to financial reports showing city revenues have been steadily falling for months. Through the first quarter of the fiscal year, she said, collections of sales taxes, property taxes and license fees – the city’s largest revenue sources – have all declined, pulling general fund revenues down by 12 percent.
“If revenue projections hold steady through the rest of the fiscal year, we can anticipate a $50 million to $60 million shortfall,” she said.
In addition to cutting staff hours, Franklin ordered an immediate city-wide hiring freeze and plans to ask the City Council to pull $12 million out of city reserves to help cover the anticipated shortfall. This past year, as part of its financial reforms, the city created a contingency fund amounting roughly to 5 percent of the general fund budget – about $30 million at last count.
All of these measures should reduce the year-end deficit to between $13 million and $18 million, the mayor said, adding that she’ll figure out how to bridge the rest of that gap within the next few weeks.
Unlike the budget crisis that rocked the city earlier this year, this projected shortfall is due entirely to sliding revenues brought on by the souring economy – a problem currently being felt by nearly all cities and states – rather than bad bookkeeping or overspending, Franklin said. In fact, she said, city expenses are 2 percent under budget for the year so far.
Although the mayor has the authority to order furloughs for most city employees, she cannot unilaterally cut such non-executive departments as the city ethics office, the independent auditor or the City Council. She also needs Council approval to affect cuts within the Municipal Court and the city solicitor’s office. Hartsfield-Jackson Airport and the city’s Watershed Management department are not part of the city’s general fund and will not be affected by the mayor’s actions.
Up until now, the APD had escaped officer layoffs and suffered lighter budget cuts that other city departments. Franklin acknowledged that cutting police man-hours is a concern, but said she has no choice.
“We’re going to have a safe city, but we don’t have the money to fund all employees at 40 hours a week,” she said. “The city will not run a deficit while I am mayor.”
November 13th, 2008 at 12:32 am
ATL City Council keeps increasing and increasing its budget annually. And they never offer any solutions. They are truly an embarassment.
December 2nd, 2008 at 1:23 pm
[...] 2 weeks ago, Atlanta Mayor Shirley Franklin announced city-wide employee furloughs to cut [...]
February 11th, 2009 at 5:33 pm
[...] revenue figures are in – and, surprise, they’re grim. The notorious police furloughs (remember them?) that began about a month ago were part of an effort by the Franklin administration to slash [...]