Mayor Leirion Gaylor Baird’s proposed budget for the 2020-2021 fiscal year closes an estimated $12 million budget gap with a combination of cuts and revenue enhancements, but no increase in the City property tax rate. The gap is largely due to the impact of the COVID-19 pandemic on city revenues, including a significant decline in projected sales tax receipts, which fund 44 percent of the general fund budget.
The Mayor will present her proposal to the City Council at 1:30 p.m. this afternoon.
“During this time of unprecedented economic uncertainty, balancing the budget required shared sacrifice,” said Mayor Gaylor Baird. “We made difficult cuts, we asked our employees to be part of the solution, and we collaborated with partners to increase some revenue sources. At the same time, we remained steadfast in our commitment to make strategic investments in key city priorities without increasing the property tax rate.”
The City implemented a two-year budget in 2012, but due to the continuing economic uncertainty, Mayor Gaylor Baird is asking the Council to take action to allow one-year budgets for the next two years. She said developing two separate budgets will enable the city to more adequately respond to changing revenues and community needs.
In May, the Mayor implemented a hiring freeze, suspended employee travel and took other action to shore up the City’s cash position and help close the FY 20-21 budget gap. Her proposed budget calls for five actions to balance the budget:
- Reduce department budgets by nearly $8 million. This includes about $2.5 million in interest earnings taken from individual departments; $1.45 million from leaving positions vacant; $400,000 from cutting one day a week at all library locations; and reducing the Parks endowment match by $200,000.
- Reduce capital improvement projects by $878,000. This includes cuts to sidewalks, playground improvements, commercial district improvements, and street trees.
- Propose to the city unions a freeze in the cost-of-living adjustment (COLA) wages, saving $670,000.
- Pay off bond debt early to save $534,000.
- Increase non-tax revenues by about $2.3 million. This includes increases in some Parks and Recreation fees; approximately $1.25 million from a new franchise agreement with Black Hills Energy; and approximately $920,000 from the Lincoln Electric System city dividend.
Mayor Gaylor Baird said her budget also includes key investments in four priority areas:
- Public safety, health, and quality of life. This includes the complete implementation of body-worn cameras in LPD; doubling LPD’s support for its partnership with the Mental Health Association; and funding for Read Aloud Lincoln, three new neighborhood parks and Emerald Ash Borer response.
- A more equitable, inclusive and resilient city. This includes funding for proactive housing enforcement, wellfield repairs, water main replacements, the NeighborLNK program of Aging Partners, a childhood lead poisoning prevention initiative and four new HandiVans.
- Excellence and continuous improvement during the pandemic. This includes six additional Health Department positions, an additional care manager at Aging Partners and technology improvements to enhance cybersecurity and promote teleworking.
- Infrastructure and services to speed the city’s economic recovery. This includes $73 million to maintain, preserve, optimize and grow Lincoln’s street system. The budget also includes funding for water and wastewater improvements, broadband conduit, the West “O” Street entryway project, Haymarket South streetscape and parking, and bus shelter improvements.
The city’s property tax levy will remain at 31.980 cents per $100 of assessed valuation. That equates to $576 in City property tax for the owner of a $180,000 home. Out of every property tax dollar the City’s share is about 16 cents. The total tax-funded budget is decreasing from $214.0 million in the current fiscal year to $210.4 million in 2020-2021. The number of city employees has dropped from 2,227 FTEs in 2006-2007 to 2,225 FTEs in 2020-2021, despite Lincoln adding more than 45,000 residents during that time.
The City Council’s public hearing on the budget is Monday, August 3, and the Council is scheduled to adopt the budget August 24.
More information on the City budget is available at finance.lincoln.ne.gov.