Tuesday, May 15, 2012 | 10:30 p.m.
The Henderson City Council authorized the use of reserve funds Tuesday night to plug a $13.5 million deficit in next year’s budget.
Depressed property values and decreased tax revenues continue to constrain the city’s budget, Finance Director Richard Derrick said, necessitating the use of reserve funds, even though the budget shrank by $20 million compared with the current year.
The city’s budget for next year — which was approved unanimously by the council — avoids any layoffs and maintains current levels of services to citizens, Derrick said.
The budget will shrink to $479.7 million, down from $498.4 million the previous year, a decrease Derrick said was achieved in part through cuts in operating costs and employee buyouts. Negotiations for concessions with employee unions could bring more money to the city and lessen the amount of reserve funds needed to cover the gap, he said.
The city has cut a total of $105 million from its budget through a number of measures over the last four years, including employee buyouts, cuts in management and executive pay, and foregoing giving employees a cost of living adjustment for the past three years.
Derrick said the economy is showing signs of recovery as consolidated tax revenues — made up of six taxes, including those on the sale of cigarettes and liquor — are increasing and the loss of property tax revenue has slowed.
“We’ve seen some growth, but It’s going to be quite a while for us to dig out of this hole,” he said.