Surprise city budget trimmed by 5.5%

Surprise City Manager Randy Oliver has implemented a 5.5 percent cut to the city's operating budget amid a continuing slide in sales tax revenues.

No layoffs were necessary, but Oliver is limiting new hiring, suspending overtime with an exception for public safety and reducing city travel, training and food purchases.

The trims, implemented this month after weeks of discussion, are considered a precautionary move, Oliver said.

"What we're trying to do is avoid some of the harsher things some other communities are facing," he said.

Cities and towns across the Valley are suffering in the recent economic collapse. Surprise, until recently, had been in better shape than most and was in step with its conservative projections.

That changed in October, however, when sales tax revenues came in 4 percent lower than expected. The city received $8.15 million, but anticipated $9.2 million, said Michael Schrock Jr., director of management and budget. By June 30, the end of the fiscal year, the city still hopes to reach a total of $26.4 million.

The real test will come during the holiday season, when the city typically receives 35 percent of its total sales tax revenue for the year. The city is already planning a marketing campaign encouraging people to shop in Surprise. Whether the city rebounds will not be clear until the end of January, when sales tax revenues from December are released.

The city has not ruled out the need for an additional 5 percent cut in the future. Details of this additional cut have not been finalized, though it would certainly require layoffs, Oliver said.

Surprise city budget cuts

Surprise City Manager Randy Oliver has cut the city's operating budget by 5.5 percent for an annual savings of about $5.2 million.

$621,700: Outside consulting

The hiring of consulting firms will be scaled back. The city has used outside firms in the past in areas such as strategic planning.

$500,000: Staff transfers

Thirteen community development and engineering employees will be transferred to the Water Services Department, which is funded by utility rates, not the general fund. The employee skill sets will transfer to the water services positions. In fiscal 2010, this move will save almost $1 million.

$169,000: Travel and training

All out-of-state travel has been stopped unless approved by the city manager. Trips already scheduled should be canceled unless some or all of the cost has already been paid and cannot be refunded. The city is suspending until further notice its tuition reimbursement program for training. If an employee has enrolled in a class that has yet to begin, it should be canceled.

$50,000: Auto stipend

The monthly automobile stipend has been eliminated for staff. Most employees had been receiving $300 a month. Now, employees will log mileage and receive reimbursement based on Internal Revenue Service guidelines.

$33,700: Food purchases

City funds may no longer be used to purchase food, coffee, beverages or kitchen supplies for staff meetings, training and retreats.

$30,800: City Council cuts

Surprise City Council members will no longer receive meals prior to meetings, saving about $6,000. Because few City Council members are logging mileage, the travel budget has been reduced by about $24,800.