Budgeting in Challenging Times.

On Monday night, I presented a draft budget for FY2021. Over the next four weeks, the City Council will be holding Work Sessions to consider the FY21 Budget.  Work Sessions are key opportunities for Councilmembers to hear from and question staff regarding the proposed budget numbers and work program.

Obviously, we are in a challenging time, and we are in the process of scrutinizing every aspect of the budget to see what effect the COVID-19 pandemic will have, what will be needed during recovery and how to position the City for the coming years.

Since Monday night, I have received a number of questions about potential cuts and other measures given the current crisis. Some have expressed concerns that we are treating this like any other budget year. I assure residents that this is not the case.

As I noted in the Newsletter article about the proposed budget and in my presentation to the Council last Monday, I have already taken significant steps in consideration of the health emergency and its possible financial repercussions:

• Union negotiations with the City’s two unions have been put on hold as have the normal wage increases that occur on July 1 for both union and non-union employees. We will then be able to go into negotiations with more knowledge of the economic situation.
• A number of sidewalk projects and a building project in the Community Center (totaling $1.6 million) were postponed to the FY22 year of the proposed Capital Improvement Program as were some smaller improvements and projects, totaling about $100,000.
• Public art projects were postponed; funds may get shifted into assistance programs.
• We have also shifted some unused conference and office expense funds to the mini-grants program to provide immediate support to local businesses.

Staff have been evaluating programs and expenses to determine those that will not occur or could be cut or postponed as well as identifying revenue sources that may be affected by the pandemic and the associated economic disruption.

As the current crisis is still unfolding, some of these numbers were not available last week. It may be a few more weeks before we are able to project the levels of federal support we may receive from recently adopted legislation and we are following efforts for an additional federal aid package. Staff was also unable to compile some data last week because they were providing and are continuing to provide direct service to many businesses and residents affected by the pandemic. It is anything but business as usual for the Takoma Park city staff.

As the Council deliberates, items that are likely to be affected or those that the Council may wish to handle differently will be highlighted so that those elements will be part of the Council’s Reconciliation List. The Reconciliation List is the list of possible adjustments to the Proposed Budget that the Council will consider as it moves to the adoption of the final budget.

I encourage members of the public to watch the Council’s Work Sessions and follow along as the Reconciliation List is populated with possible adjustments. Your comments about priorities, the tax rate, and programs that you value or would prefer to see ended are all important to the Council as they go through the budget consideration process.

The City of Takoma Park has a well-deserved reputation for fiscal responsibility and transparency, and that will not change. During the Great Recession, we took the steps needed to maintain the essential services and character of Takoma Park, even as significant and painful cuts were made. The cuts happened at the appropriate time, when the extent of the impact was clear so that our actions would be effective. We will continue to be fiscally responsible and follow best practices in dealing with the economic changes ahead of us.

Uncertainty is challenging. Health uncertainty and financial uncertainty are both stressful and they are occurring at the same time during this COVID-19 pandemic. I know we will get through it together as a community, but it will be hard, particularly in the coming weeks. A constructive way through this is to plan for different situations, both near term and long term so that we know our options. The FY21 Budget is that plan for the City, and we will work on it together beginning Monday.