The city of Clovis is facing a $3 million shortfall for the fiscal year that begins in July -- and a long, slow climb in the years ahead before city revenues match the levels seen at the start of the recession.
That assessment was part of a five-year financial forecast given the City Council on Monday night.
City Finance Director Robert Woolley said employees may be asked to help close next year's shortfall with wage and benefit concessions -- the third year in a row that employees could be asked to pitch in. Departments have been asked to look for other savings as well.
"Each department now has instructions," he said. "They know what the shortfall is and to come back with some recommendations" for cuts.
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But City Manager Kathy Millison said the city needs to examine permanent cuts to wages, benefits and operations instead of negotiating concessions with employees each year.
Since cuts began two years ago, the city has left vacant or eliminated 90 positions, including 31 for police and firefighters.
Declines in property taxes and development fees are driving the need for more cuts next year. Last year, the council had to cut $5.3 million from the city's current budget.
Woolley said city departments may have found savings in their budgets that will make the shortfall for next year less than $3 million.
"Every dollar saved is one less that we need to cut next year," Woolley said.
But Mayor Harry Armstrong fears the shortfall could get worse. He is concerned state lawmakers will try to take more money from cities to close their own budget gap.
"It could be more by the time June rolls around," he said. "Until I have it in my pocket, I don't know what I've got."
Over the long-term, property taxes -- the city's largest revenue source -- will take nearly five years to reach 2008-09 peak levels, Woolley said. And sales tax receipts, the second largest revenue source, are expected to improve slightly next year, but will not reach 2007 levels until 2014.
"We fell off of the cliff and we are starting from the bottom of the cliff and trying to climb out," Woolley said.
City residents also are being asked to help the budget.
Residents will see higher water rates in July. The city in April will discuss higher sewer rates that could also take effect in July. Both rate hikes are required to pay for bonds that financed the city's new water and sewage treatment plants.
But a 4% rate increase previously approved for trash services will likely be cut in half, to 2%. The city was proposing to expand its landfill, but the recession has dampened population growth.