Update: Friday Nov. 20th: Met with the city’s Deputy Chief of Finance today, Marcus Jones. Nice guy. He’s been on the job for about 3 months now and walked into a tough budget. The city’s already trimmed 25 million from its budget. Now its facing another 10 million dollars in cuts. The city’s already made the tiny cuts to get by… this time there may have to be some real meat. Not good news. Service and jobs could be on the table. The mayor has given his finance people until mid-December to come up with a viable plan. Update end.
The state just released a bleak financial picture and a day later… Richmond follows. The city is facing a $10 million dollar budget shortfall. It’s actually not too bad considering the city has a $1.5 billion dollar overall budget. The mayor cites reductions in state funding and a drop in sales tax revenues as the reason for the shortfall. Mayor Dwight Jones says, “The entire nation has been experiencing lingering effects of the recession and Richmond is no exception. A number of key revenue sources weakened in FY 2009, and they are continuing to falter in the current year (FY 2010). Moreover, we have to be realistic and assume that the ripple effects will continue into FY 2011.”
The main reason for the lower than project revenue is the decline in the sales tax collections. Local sales revenues are 7.9 million less than projected and the state share is down $1.9 million. Another $2.6 million of the shortfall is a direct result of the state’s budget cuts announced in September 2009.
The Chief Deputy of Finance will speak before Council Vice-President Ellen Robertson’s Finance Committee meeting tomorrow at 4:00 in City Council chambers. He’s going to go over the shortfall and how the city is planing to handle it. Sounds like I’ll be following up on this tomorrow.