Evansville plans for possible state funding cuts
Then throw in a big question mark because the next state budget faces an estimated deficit of nearly $3 billion.
It could mean a crisis. That's what Evansville officials are planning for.
"I'd rather be in a position that Evansville is prepared to adjust to a shock to its budget in 2011," City Administrator Dan Wietecha said. "If that's the case, we're even better positioned to deal (with it) in 2012."
New in this budget cycle: City officials will identify expenditures that can be delayed until later in 2011 or expenses that could be cut if the state dramatically cuts the city's shared revenue in mid-year.
If lawmakers were to cut shared revenue by 30 percent, Wietecha wonders where the city would make that up and how quickly municipalities would have to make the adjustments.
The budget that will be introduced to the city council Tuesday night has a 0 percent levy increase, Wietecha said.
Part of the planning difficulties result from different budget cycles.
Municipalities are on a calendar year, so they are planning their 2011 budgets. Councils usually approve their budgets in November.
The state is on a two-year budget cycle, with the next budget running July 1, 2011, to June 30, 2013.
That leaves municipalities planning their budgets based on "some pretty good estimates" from the state on what their shared revenue payments will be in 2011, said Curt Witynski, assistant director of the League of Wisconsin Municipalities.
Evansville's shared revenue estimate for next year is the same as this year: $458,905.
The city's estimate for transportation funding next year increased to $297,791. The city received $261,986 this year.
Shared revenue has either not increased or been cut each year since 1995, Witynski said, including a 3.5 percent cut this year.
The league is advising its members that they likely will receive the same funding as in 2010.
In the 15 or so years Witynski has been following the budget process, no incoming governor has changed the shared revenue payment for the first year of the two-year cycle, he said. Governors typically have placed cuts in the second year of the budget cycle.
"They've always just written into the budget whatever the estimate was that communities would get," he said.
Theoretically, a new governor, when he presents his budget in January, could put whatever he wants in the budget, Witynski said.
"It's been this tradition, and I think it makes sense, all these communities are basing budgets on certain amounts," he said.
Evansville officials aren't as optimistic.
As a result, he said, the city might want to delay buying a vehicle or making other big-ticket expenditures until later in the year.
"If you bought it in January, you've lost the opportunity to say we're going to hold off on this a year," he said.
Witynski hopes the next governor will not make cuts to solve the state budget problems in the first year.
"We'll do everything we can do to say it doesn't make sense to pass on the state's budget problems to local government," he said.
Witynski hasn't heard of other communities approaching their budgets like Evansville, he said, but "it's not a bad idea just to be cautious and have those ideas in the plan."