City of Sacramento Faces Big Budget Shortfall

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(Sacramento, CA)
Tuesday, January 22, 2008

City finance director Russell Fehr says declining sales tax returns and the housing crisis have left the city with less money. He says three departments combined: police, fire and development are over budget by about 14 million dollars.

“We’ve had these cost increases that ratchet up and no growth to support them. So over a three year period we’ve gone from a balanced budget to this large gap.” 
Fehr says to close the gap departments will try to cut costs by up to 20 percent and many part-time employees have been laid off. He says it’s likely more employees will lose their jobs and it’s possible city fees or taxes might go up to boost revenues. Regardless, he says, the city has until May to balance the budget and hand it off to the council for approval.