Lake Charles city officials are struggling how to grapple with budget woes. Last year's budget ran a deficit of $2.56 million. The current fiscal year is projected to have a $2.4 million deficit and the proposed budget for the 2011-1012 fiscal year foresees a $3.6 million shortfall.
But it's not like the city isn't paying its bills because they have an operating reserve they have been able to dip into to cover expenses. Problem is the mayor and administrator say if they keep using their savings they'll no longer have a fund for emergencies.
City officials say they need to increase revenue so they don't have to use emergency dollars each year to balance the budget. Said Mayor Randy Roach, "We know that unless we get to a point where we're putting money back in the bank, one day we're going to have to deal with that situation."
One possibility is to charge a fee for garbage and trash pickup-- something that would be new to Lake Charles residents. "We have been providing trash and garbage collection without charging for that. So, we're looking at that as a possible way. It's a service. We do provide it. It's common for communities to charge extra for that."
As well, property values are likely to go up as a result of reassessment next year-- which could bring in extra dollars for the city if they maintain the current property tax rate. "If we just maintain our property tax rate at the same rate it is today, we anticipate that we could probably experience a five to six hundred thousand dollar increase in property tax revenue."
Officials say there are several reasons for the shortfall-- increasing costs for retirement, insurance gasoline. "And when you total the increases in the last three or four years in retirement contributions and health insurance costs, that pretty much covers what we're talking about in terms of the annual deficits that we've been experiencing."
And though city sales taxes are growing they're not yet up to what they were in 2008 when the bottom fell out. And city officials say they have made cuts. Explained, Administrator John Cardone. "We eliminated thirty budgeted, unfilled positions. We've also been monitoring vacant positions. We've limited travel. We've limited purchases of vehicles and equipment or deferred those purchases so, even doing all that we still are projecting a $2.4 million dollar deficit."
And course that's this current year. The budget for the upcoming fiscal year which starts October 1 projects a $3.6 million deficit.
City officials point out they collect a quarter per cent less sales tax than other local governments and say if they had that extra quarter there would be no deficit.
The city will hold a public hearing August 30th at the Lake Charles City Council agenda meeting to discuss the proposed budget.