2021 Birmingham budget

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The 2020-2021 Birmingham budget includes the operating budget for the City of Birmingham for the fiscal year July 1, 2019–June 30, 2020 as well as a capital projects budget.

Mayor Randall Woodfin proposed to the Birmingham City Council that it plan to continue operating under the 2020 Birmingham budget for a few months so that his office could better understand the fiscal impacts of the 2020 Coronavirus pandemic and make preparations for a significant reduction for the next year. He proposed submitting a proposal on August 20 with the aim of passing a budget before October 1. The delay would also potentially better allow for public hearings to be conducted in a safe manner.

In mid-June 2020, finance director Lester Smith suggested that the anticipated loss of revenues for FY 2021 would be around $73 million. Dipping into the city's $75 million "rainy day fund" would help offset those losses, but Woodfin expressed that he preferred to address most of the shortage with spending cuts distributed across all city departments. In letters dated June 19, Woodfin notified community groups, boards and non-profits to expect significant cutbacks in financial support and in-kind services, including free rentals and security for events. On June 30 he sent an email to all city employees notifying them that the budget did not have room for merit, longevity or cost-of-living raises. A month later the mayor's office reported that revenues were still on track for the predicted 20% decrease.

Mayor's budget proposal

Woodfin proposed an operating budget of $412 million, a $39 million (8.6%) decrease from the $451 million 2019-2020 budget. The proposal accounted for the revised estimate that $63 million less than projected had been collected from taxes and fees during the previous fiscal year.

Cuts to expenditures would include the elimination of 447 unfilled positions on the payroll and pay cuts for appointed staff (as well as a 10% cut for the Mayor's own salary),. The city would furlough part-time workers and all staff at facilities not operating during the pandemic. The city also offered early retirement to long-time employees and eliminated 9 of 12 paid holidays. Those efforts were projected to save the city $26.2 million in personnel costs. In addition to direct cuts, the mayor announced a shift in organizational structure with employees reporting to departments responsible for particular functions rather than specific facilities. The result would appear in the budget as a net gain in the Birmingham Police Department budget, even though the number of sworn officers would be reduced by eliminating vacant positions.

Some of the city's outstanding debt would be restructured, saving $3.8 million. The city would preserve or slightly increase its investments in pension obligations, facility and equipment maintenance, and public works. Funding for outside boards and agencies would be sharply cut, and the city's funding for economic incentives for recruiting business and development would shrink by $1.7 million. Woodfin also announced that the city planned to construct a health clinic for employees.

Woodfin's proposal would include spending $23 million from the city's $95 million general reserve fund to make up the difference between revenues and expenditures. He did not propose increasing any city taxes or fees.

References

External links

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