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PROPOSED BUDGET

• $135.6 million proposed 2012 general fund budget
• $7.87 proposed tax rate per $1,000 of taxable property value
• $7.97 current tax rate
• Sept. 8: First public hearing before City Council on the budget
• Sept. 22: Final public hearing on budget, votes to set tax rate and adopt budget
• Oct. 1: Start of next budget year

BUDGET SHORTFALL

Contributors to Cape Coral’s $4,005,090 budget shortfall:

• $831,884 tax rate decrease
• $313,430 restored for street lighting
• $176,668 state revenue sharing reduction
• $829,308 unrealized savings from rejected police union contract
• $1,853,800 unrealized savings from rejected firefighter union contract

More

When public safety workers rejected tentative union contracts, it erased $2.6 million of anticipated savings for Cape Coral’s proposed 2012 general fund budget, which must be balanced by Oct. 1.

The general fund shortfall now stands at $4 million, according to city Budget Director Sheena Milliken.

Both police and firefighters overwhelmingly rejected a tentative contract. The police vote closed July 29 and the fire vote closed Aug. 5.

The contract called for a 3 percent pay cut and was to raise their pension contribution from 7 percent to 9 percent of their pay. The police and the city are returning to negotiations Aug. 23. A resumption date with the firefighters hasn’t been set.

The votes to set the tax rate and adopt the budget are Sept. 22. The time left to reach an agreement and for the union to hold a ratification vote is tight.

“To have something in place on the 22nd and agreed on is probably going to be difficult to achieve,” city spokeswoman Connie Barron said.

The city should look at options such as declaring an impasse with the unions, said Mayor John Sullivan.

The lopsided votes made it appear the unions didn’t try to sell the negotiated deals to their members, he said. Police voted 185-1 against the contract. The firefighters voted 177-0.

The City Council voted July 25 to reduce the preliminary tax rate to $7.87 per $1,000 of taxable property value from $7.97. By law the rate can’t be raised now that it is approved. The rate reduction will require $831,884 in cuts, or additional income for the city.

Cuts will be easier to determine if the union contract issue is resolved quickly, District 7 candidate Erica Warren said.

“Obviously, we have to cut if we want to balance the budget. Every family out there has to balance their budget,” Warren said. “They’ve already cut a lot.”

Warren is one of four District 7 candidates running in the Sept. 13 primary.

City Manager Gary King is working on the other needed cuts, Barron said.

“He’s not issued any statement as to what direction he is going,” Barron said.
Sullivan said he’s uncertain about how he’d address the shortfall.

“I do have a line-item veto. Gary ought to be able to squeeze the other $1.3 million out,” Sullivan said.

The city could save money by reducing the use of consultants, District 7 candidate David Stokes said.

“I would like to see the expense spent on outside consultants, like the $200,000 for the utilities expansion program audit, reduced and have our capable employees do it for free,” Stokes said.

“New revenue should be obtained by bringing more business into Cape Coral.”
District 7 candidate Mike Garr and incumbent Derrick Donnell could not be reached for comment.

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