Chattanooga: Budget coming up for vote tonight

The Chattanooga City Council tonight will consider a proposed $170 million budget that includes no tax increase.

The proposed budget, which will be up for the first of two readings at tonight’s full council meeting, accounts for high fuel costs, expected lower-growth revenues and a new employee pay plan but also includes increased allocations for agencies such as the Chattanooga Area Regional Transportation Authority and the Chattanooga-Hamilton County Bicentennial Library.

“When we came into office, people said there’s no way that you can get through a whole term without raising taxes, but we have,” Mayor Ron Littlefield, who was elected in 2005 and is up for another four-year term next spring, said Monday. “We continue to tighten up (and) to work smarter.”

The city has not approved a property tax increase since 2001.

The proposed budget for fiscal year 2009 represents roughly a 2.2 percent increase over the current fiscal year’s $166.4 million budget, City Chief Financial Officer Daisy Madison said. The new fiscal year begins July 1.

City officials are projecting lower rates of growth for sales tax revenues and investment returns and also expect “relatively stable” growth on property tax revenues, Ms. Madison said.

In order to help balance municipal finances, Mr. Littlefield said the city will continue to let positions stay vacant when employees leave, freeing up funds.

In addition, Ms. Madison said the city plans to cut back on materials and supplies, purchased services such as consultant fees and equipment and property rentals and other expenses.

“They’re a lot of small items, but they all add up,” Ms. Madison said.

The reductions will enable the city to pay for increased salaries under the recently implemented city pay plan, which is intended to increase municipal salaries to more competitive levels, she said.

The new budget includes no cost-of-living salary increase on top of base pay hikes and longevity pay from the new plan, officials said.

The proposed budget includes a 3 percent increase — an extra $113,000 — for CARTA, which has been grappling with high diesel fuel costs.

The bus agency still must hear what Hamilton County government is proposing to contribute in the next fiscal year, said Tom Dugan, the agency’s executive director. But if the county allocation remains at the current level and the city approves its proposed $3.85 million allocation, CARTA would be faced with about a $900,000 deficit, Mr. Dugan said.

That figure is based on projections of diesel costing the agency $4.50 a gallon, he said. CARTA last bought the fuel for $3.84 a gallon about a week ago, he said.

CARTA board members will meet Wednesday morning to talk about various ways to address a shortfall, Mr. Dugan said. Among the possibilities, he said, are cutting the downtown and North Shore electric shuttles or charging fares for the currently free shuttle service.

“Everything will be discussed,” he said.

The city also has proposed a $2.64 million allocation — or 6 percent funding increase — for the library, which the city and county each contribute to equally.

“This allocation will be contingent on (the county) funding an equal amount,” Ms. Madison said.

In recent years, the library has had to cut services as its expenses have increased. David Clapp, the library’s director, said Monday that he will have to wait and see what funding levels are actually approved by the City Council and the County Commission.

The budget will be presented to the City Council in a committee meeting this afternoon. Council Chairwoman Linda Bennett said Monday that council members “should be very familiar” with the proposed operating budget after going through a more hands-on process this year.

“I don’t think there are any surprises,” Ms. Bennett said.