GENEVA — While some city councilors lamented that the city administration was moving too slowly on reducing labor costs amid shrinking tax revenues caused by the pandemic, Council ultimately approved two resolutions on Monday evening that cleared the way for up to six to 10 employees to take voluntary layoffs for nearly two months.
Two resolutions were approved, one covering public works employees and the municipal employee union and the other covering non-represented (management) staff.
The moves were made as the city grapples with what could be multimillion-dollar shortfalls in its general, water and sewer funds. City Manager Sage Gerling and Assistant City Manager/Comptroller Adam Blowers stressed that the numbers so far are projections and that they expect more solid numbers on sales taxes collections and water and sewer revenues over the next month or so.
The city faces a general fund revenue gap that could be as high as $4.4 million in a worst-case scenario. However, if conditions improve, a best-case scenario puts the gap at $638,000.
“This is not the last thing we’re doing,” Gerling said of the voluntary layoffs, adding that many more cost-cutting ideas are still on the table, including some union concessions, such as rolling over unused vacation days instead of cash payments.
The city projects a savings of $65,000 to $85,000 from the layoffs.
“This might not seem like a lot, but it could be critical to us” later in the year, said Gerling.
She will give final approval to who is allowed to take the voluntary layoffs. There are some positions that could be determined to be critical to city functions, she explained.
At-large Councilor Frank Gaglianese said the city should have considered the voluntary layoffs earlier to save additional money, and he wondered if the city would get enough volunteers and what would happen if it did not.
Blowers said there is no plan at this point if the city does not get enough people to volunteer for the temporary layoffs.
Third Ward Councilor Jan Regan noted that those taking the layoffs will get an additional $600 in extra unemployment benefits under a COVID-19 unemployment bill passed in Congress. That program ends July 31, the same day as the voluntary layoffs end.
Those taking the furloughs will continue to get their healthcare and other benefits.
Fifth Ward Councilor Ken Camera said he’d rather see all city workers shoulder some pain by forgoing pay increases. Gerling said that could still happen.
Blowers said clearer projections on sales tax revenues will come in mid-July when the second quarter payment comes in, and Council is being provided updates every two weeks on financial conditions.
Additionally, the city, like other municipalities, is hoping, that a bill in Congress will provide strapped local governments additional aid to help shore up finances not only in 2020, but 2021 and 2022 as well.
Blowers expects the city to face fiscal challenges for “several years” from the economic calamity caused by the pandemic.