San Antonio – Employee paychecks, street maintenance, and arts funding could all see cuts as the City of San Antonio tries to find ways to shrink its next budget to meet low revenues due to the COVID-19 pandemic.
City staff presented city council members with a “trial budget” Thursday that attempts to deal with an expected $109 million shortfall in the general fund over fiscal 2021 and 2022. Staff also considered how to scale back programs that are tied to restricted funds like airport revenue and hotel occupancy tax.
Forecasts from consultants and city staff showed various revenue sources could take years to return to pre-pandemic levels, meaning cuts are needed.
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City Manager Erik Walsh said staff developed the first-of-its-kind “trial budget” with two guideposts — don’t lay off any employees and maintain community, neighborhood services like libraries, parks and human services.
“The community, as you well know, has endured a pretty rough four months, and I think we should do all we can as we go through this difficult time to preserve those services,” Walsh told council members.
Savings included in the general fund portion of the trial budget included hiring freezes, possible furloughs or even pay cuts for city employees, and reducing the money available for street maintenance projects by $50.3 million over two years.
If the economy recovers more quickly than expected, city staff say the council has the flexibility to reverse the cuts.
However, the shortfall is not just a short-term problem. City estimates show a combined $379 million worth of shortfalls in the general fund through fiscal 2025.
“I just hope my fellow council members realize, unless things really pick up, it’s not just this year and next year, which I think we’re going to manage,” said District 8 Councilman John Courage. “But it’s the two years after that are going to really hit us hard and could cause us to have to make even more serious reductions, unless we come up with additional income.”
Other programs are funded directly by certain revenue streams. Art agency funding, for example, is tied to the hotel occupancy tax, which is not expected to return to pre-pandemic levels until fiscal 2024 at the earliest.
As a result, the trial budget showed arts and culture funding dropping from $11.5 million in the original fiscal 2020 budget to $7.7 million in fiscal 2021.
District 7 Councilwoman Ana Sandoval said the city should reconsider the funding structure for the arts.
“If our economic activity drives what goes into that, then it’s not really our priority that we’re setting when we set that budget,” Sandoval said. “We’re letting the economy determine how much should go into arts and historic preservation. It’s not like we’re making a conscientious decision about how much money should go into that.”
Art agencies have already felt the pinch of the pandemic this year as part of the adjustments the city made the current combat a nearly $200 million expected hit to revenue.
“What we said to the council in April was that the sooner we deal with our financial position, the better off we’ll be. It’s just like with anything else. If you let those things linger, they compound,” Walsh said. “So to a certain extent, I think what you saw today was reflective of the action that the staff and the council took in April to mitigate those losses early.”
Council members have a goal setting session scheduled for Friday, Jun. 26, and staff is expected to propose a budget on Aug. 6, which the council could amend and pass by Aug. 17.
The city’s fiscal year 2021 will run from Oct. 1, 2020 through Sep. 30, 2021.
COMMUNITY INPUT SESSIONS
The city is hosting a series of virtual town hall meetings on the budget where residents can provide their input. They will be streamed live at www.sanantonio.gov/tvsa or the City’s Facebook page. Residents can also watch on television channels: AT&T 99, Grande 20, Spectrum 21, and digital antenna 16.1, or listen live by dialing 210-207-5555 and selecting option 1 for English or option 2 for Spanish.
Residents can submit their budget questions in advance by calling 311, emailing saspeakup@sanantonio.gov, using #SASpeakUp on social media, or by texting their question and “SASpeakUp1” to 55000.
The schedule for the sessions is below:
District 1 - June 24, 6:00 p.m.
District 2 - June 18, 7:30 p.m.
District 3 - June 22, 7:15 p.m.
District 4 - June 19, 6:00 p.m.
District 5 - June 24, 7:15 p.m.
Districts 6 & 7 - June 20, 10:00 a.m.
District 8 - June 22, 5:00 p.m.
District 9 - June 25, 7:30 p.m.
District 10 - June 23, 7:30 p.m.