Greer faces budget shortfall

By Charles Sowell  

JANUARY 27, 2010 9:52 a.m. (1)

Greer City Council directed staff to start drafting proposed ordinances to raise money from a variety of sources to deal with a $1.3 million shortfall this year and money headaches stretching for years to come.

Every municipality in Greenville County has taken a hit due to the current recession, but Greer’s problems have been greater proportionally since the city has depended on growth to fuel city funding.

Greer has been noted in recent years for its aggressive annexation program that has been largely driven by the city’s quality services.

Simpsonville suffered through a budget crisis last year, City Administrator Russell Hawes said this week, but has gotten its financial house in order since then.

Greer hopes to come up with new revenue from increased fees or taxes or a combination of fees and taxes, council members were told. There is a provision to make a special assessment on residents to make up for lost tax revenue that would be phased out once revenue increases.

Mayor Rick Danner made it clear that council is exploring options at this point.

The city has enough money in the bank to deal with the current shortfall. There is about $2 million left in the city’s reserve fund after accounting for $445,000 council voted to cover part of the current budget deficit.

Council members have been told at work sessions on the budget that the city should have a reserve fund of between $4.5 and $6.3 million based on the current budget of $18 million.

District One Councilman Jay Arrowood urged council members to commit to rebuilding the city’s reserve fund and to weaning the city from dependence on state funding.

“We’ve seen that we can’t count on state money, year after year now,” he said. “If we get it, fine, we can put it in a reserve account.”

Arrowood said state lawmakers have cut levels of funding to the city three times in the past few years and are likely to cut disbursements a fourth time this year. The end effect will be to force the city to raise fees or taxes, or both, while the state doesn’t have to.

City Administrator Ed Driggers noted the city has cut $2 million from its operating budget during the past two years and absorbed hundreds of thousands of dollars in increases on things such as tipping fees for garbage taken to landfills in Spartanburg and Greenville counties.

“We’ve reached the point where any further cuts in personnel will start affecting the services that make us what we are,” Danner said.

Council members were told in a recent budget work session that shutting down entire departments would not be enough to deal with the funding problems.

At the current rate of 92.8 mils property taxes pay for less than half of the city’s expenses. The rest of the budget is made up from a combination of things like license and permit fees, state and federal funding.

License and permit fees, along with state money, dried up since the start of the recession.

City officials said the financial crisis is not due to irresponsible spending or the city’s new municipal complex, which would have been needed, recession or not.

There is no deadline for council to decide on how to deal with the shortfall, city officials said Tuesday night.

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Raymond Evans  - Who could have guessed?   |2010-02-07 07:09:02 During 2006-2008, I wrote to and spoke with my Greer councilman and the mayor. They reassured me that 10% perennial growth was assured, and that they had confidence that there could not be a shortfall. They also belived that massive annexation would be profitable, not a burden to service. I moved into an unincorporated neighborhood. I now receive the same services from the county and private companies, for $1,400 less. If Greer cared about its citiens, it would do the same thing hundreds of mill towns did: Disincorporate. South Carolina has special service districts, so the CPW would still operate (without the sweetheart loans), and everybody could save money. I now see tons of Greer City Police patrolling. I'm sure it is for our safety and has nothing to do with revenue shortfalls. Reply

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