Phoenix came out $25 million ahead of its projections in the fiscal 2014-2015 budget, according to the city’s budget department.
$2.1 million extra in revenue was made over projections mainly from the Emergency Transportation Services revenue, Phoenix Director of Budget and Research Jeff Barton told City Council at a meeting on Tuesday. This will not last though due to changes with access reimbursement rates within this current fiscal year on the state level, Barton said.
Phoenix saved $22.9 million on expenditures, mainly from government job vacancies. A total of 616 city employees retired — a record number — meaning the city did not have to pay for those jobs until they were filled again. Barton said there wasn’t a dip in performance levels in response to these empty jobs.
Strong correlation between savings and job vacancies
— Kevin Lane (@KevinTheLane) September 22, 2015
Due to revised revenue estimates, the projection of revenue for Phoenix had to be dropped $15 million. A successful 2013-2014 fiscal year meant there was an extra $18 million that helped minimize the potential damage.
“Because of that revenue reduction of $15 million, as well as the direction of (City Council), we started a strong relationship and collaboration with the University of Arizona to refine and hone our revenue estimates,” Barton said. “With that collaboration, we now have access to local and national economists that understand better than we do the impact of certain individual indicators on the local economy.”
Along with these job vacancies, city workers drove around 200,000 fewer miles than in the previous year. The savings correlated with the vacancies according to Barton.
These savings are a one-time deal, however. There is no expectation that these savings will continue into this fiscal year, Barton said.
The $25 million will help the prevention of future deficits.
“For 2016-2017, we feel we have a lot of momentum and a good jumping off point,” he said. “What we are planning to do is use that extra fund balance — the $25 million — to offset a projected deficit we have for 2016-2017.”
Barton said his department is recommending that the city use this extra money to offset the fiscal 2016-2017’s budget’s projected deficit of $58 million. This would allow the city to avoid cutting services, he said.
Cost reductions seem to be a theme for the upcoming fiscal year of 2016/17.
— Kevin Lane (@KevinTheLane) September 22, 2015
Ed Zuercher, the Phoenix city manager, praised the city’s progress. “We got our work cut out for us. Because of what we have done together that work is starting to take shape into less of a deficit,” he said. The 2015-2016 fiscal year requires no change in revenue, and no change to programs and services are anticipated.
It is possible that within the next few fiscal years Phoenix could completely make up it's deficit.
— Kevin Lane (@KevinTheLane) September 22, 2015
Barton said the city will continue looking for ways to save even more in the future.
“I think what we have to do is continue to look at different ways to be more efficient, which is what we have done, and we have over $100 million worth of efficiencies over the last several years,” he said. “We are going to continue to push that, and try and find those efficiencies.”
“The other thing, is looking at unique ways of doing things, things that break prior processes, trying to look for new ideas and also evaluate programs, to determine what programs are needed and what programs aren’t needed,” Barton said.
Contact the reporter at Kmlane5@asu.edu
