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 Mayor Sullivan Proposes Budget Solution to City’s Unions 

  

8/27/2009
Mayor's Office

Cost-saving measure would help minimize future staff reductions                                                                       

8/27/09  |  Contact:                                         Sarah Erkmann, 343-7103

In response to the city’s ongoing budget crisis, Mayor Dan Sullivan offered city unions a potential solution designed to offset the skyrocketing costs of labor agreements and mitigate layoffs. 

The mayor met with representatives from all the city’s unions during the last two days. The proposal he provided to them is a 37.5-hour workweek for all city union employees for up to two years. It is estimated this would save the municipality $6.7-9.7 million each year.

“When we first began the budget-balancing process, we knew the unions needed to be part of the discussion, so we asked them to bring forward ideas for cost savings.  While we have received a number of suggestions that would result in some operational savings, none came close to closing the budget gap,” said Mayor Sullivan.

“We decided to explore an option that would be relatively simple to implement, that could be applied consistently across the board, and that would result in significant savings. We’ve now done that and hope the city unions will respond positively and in a timely manner.”

The 37.5-hour workweek would help minimize potential staff reductions in 2010, which looks like another challenging budget year. Estimates for shortfalls range between $17- $20 million.

“Costs associated with the recent labor contracts approved by the Assembly will come to bear in the next few years, so we must realize savings somewhere else,” said Sullivan. “If we can reduce work hours while maintaining staff and minimizing disruptions in city services, then we have a win-win situation.”

Budget planning for 2010 is underway, with a preliminary budget due to the Assembly by Oct. 1. The 2009 budget is still several million dollars short, and additional cost-saving measures are being examined. The Assembly plans to address the 2009 and 2010 budget during its work session this Friday, August 28.

The mayor’s financial team confirmed the $9 million revenue shortfall initially identified by the 60-person transition team soon after Mayor Sullivan took office on July 1. In the weeks since, the administration has worked collaboratively with city departments to identify ways to trim expenses and save money. As part of that effort, 27 city personnel reductions were announced earlier this month.

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