Back in January, we reported that Louisville’s new mayor, Greg Fischer, was projecting a $12 million deficit in the current fiscal year ending June 30, and a $20-30 million deficit in next fiscal year. At that time, the mayor said: "There have been some cities that declared bankruptcy. There are others that are teetering on the edge of bankruptcy. We are not going to allow that to happen here in our city. So we have to take action.”
Today, Mayor Fischer unveiled a substantial effort to deliver on that promise, by proposing a balanced budget for the new fiscal year that does not raise taxes but makes strategic investments in the future, including building the Southwest Regional Library, funding three new police recruit classes and foreclosing on 100 vacant and abandoned properties.
The spending plan — $512 million in general fund dollars — also invests significantly in public safety, which will result in 96 new police officers and one new fire recruit class.
The budget also makes structural changes that will help the city begin to solve its fiscal challenges so future expenses more closely match future revenues. The budget, for example, reduces overtime across city government by 10 percent, a $3.1 million savings, and the city will begin to see savings due to new union contracts in Corrections and Emergency Medical Services. In addition, the mayor is giving up his contingency fund.
In 17 months of the administration, Fischer and his team have addressed 40 percent of the $25 million structural imbalance.
“Louisville is one of the best cities in the world and it deserves the best city government in the world – best at economic development, best at protecting our citizens, best at responding to emergencies,” Fischer said. “This budget helps us start to achieve those goals and sets us on the right course.”
The budget contains no layoffs and no furloughs and gives non-union employees a 2 percent cost-of-living raise.
The city was facing a $20 million deficit in the budget, but was able to close that gap for two reasons.
First, revenues are estimated to grow 2.7 percent, a more robust rate than originally anticipated, which will produce $13.5 million. “We are seeing increased tax revenues from an overall improved economy,” Fischer said.
Second, the city is selling two downtown parking lots – the City Hall Lot and the Mud lot – to the Parking Authority of River City for $10.7 million. PARC is also paying the city $4 million for two garages which it purchased from the former county government at merger but for which the payment was never made.
During his mayoral campaign in 2010, Fischer promised citizens that he would begin construction on the Southwest Regional Library in his first term.
Revenue sources in current Louisville city budget