Mayor Domenic Sarno and the finance team propose using $12.5 million from the reserve fund to help balance next year's budget.
SPRINGFIELD – Some city councilors raised concerns Friday that efforts to reduce a multi-million budget gap in Springfield have relied heavily thus far on temporary fixes such as raiding reserve funds.
During a Finance Committee meeting at City Hall, committee Chairman Michael A. Fenton and Councilor Timothy C. Allen said they are troubled by a current proposal to use $12.5 million from the stabilization “rainy day” reserve fund to help balance next year’s budget.
Michael A. Fenton“It has been raining for four years,” Fenton said, referring to budget hardships. “Basically we are delaying making difficult decisions.”
Lee C. Erdmann, the city’s chief administrative and financial officer, told the council on Monday that initial decisions made by Mayor Domenic J. Sarno and the finance team have reduced the estimated budget gap for next fiscal year from $44.6 million just one month ago to a current gap of $14.9 million.
Councilors, while praising the initial budget paring efforts, said many of the measures involved are one-time fixes and delayed expenses.
The mayor and finance team, for example, are proposing that a mandate to fully fund city pensions be extended from the current deadline of 2030 to a new deadline of 2039, as newly permitted for communities statewide by the state Legislature.
Some councilors said the move seems to just drag out the fix.
The annual use of reserve funds, which has ranged from $10 million to $12.5 million in recent years, “is not a good, long-term sustainable strategy,” Fenton said. The proposed use of $12.5 million in the new budget, if approved by the council, would leave a reserve balance of about $31.2 million.
The city’s annual budget is approximately $550 million, and the city’s financial reserve policy calls for keeping a reserve of between 5 percent and 15 percent.
Both Fenton and Allen said they will seek support for a stronger policy for protecting the city’s reserve funds.
Councilor Amaad I. Rivera, also in attendance, said that he does not see comprehensive solutions thus far to address the city’s top budget expenses such as health care, pension costs and the Police Department budget.
Erdmann said the mayor and finance team are proposing the use of reserve funds and other measures to protect core services, and have not proposed layoffs to date. The city, however, is exploring options such as a wage freeze, furloughs and other union concessions that will require bargaining, he said.
Other current proposals are to eliminate nearly all vacant positions and continue a virtual hiring freeze, Erdmann said. The mayor and finance team have also reduced department budget requests by $8.9 million, he said.
Councilor Kateri B. Walsh was among officials attending Friday’s meeting, and joined Fenton, Allen, and Rivera in supporting a proposal to continue an annual trash fee beyond its scheduled expiration on June 30, saying the city needs that annual revenue estimated at $3 million. Allen said he is hoping that a special meeting will be scheduled soon to consider extending the trash fee.