Budget shortfalls befall city, state

By Staff
MARCH 11, 2001
The news broke last week that the state isn't the only political entity suffering budget woes. While the state will apparently start fiscal year 2002 about $120 million in the red, the city of Meridian also has money problems. Chief Administrative Officer Ken Storms says the city is facing a shortfall of about $280,000, and, if revenue doesn't increase soon, the shortfall could go as high as $700,000.
The declining economy  dare anyone use the word "recession" is troubling. The state now is growing at an annual rate of about 1 percent, well below the heady 5 percent growth of the 1990s.
No easy decisions
City officials concede making ends meet will not be easy. If revenue doesn't pick up soon, many difficult decisions will have to be made. Already, city department heads have been alerted to the possibility of budget cuts. Storms said an "across the board" cut in city government is an option.
A slowdown in sales tax revenues is bearing the brunt of the local blame for the shortfall. Fines collected on tickets written by the police department are also down.
Because this year's budget was so lean to begin with, Storms said, leaders are having to look very hard to find areas that can be cut. Personnel seems to be one of them. Storms said some positions inside city government may not be filled as employees resign or retire. He said 54 positions are currently unfunded.
Potential boost
The good news on the horizon may come in the form of a Wal-Mart Supercenter now under construction. It is expected to boost sales tax revenues, but any gains will likely not be fully felt until next year.
Another item received scant attention in Storms' press conference and perhaps more information will be forthcoming soon. It is a 1,500-home retirement community development project that may be locate in Meridian.
City officials are left with difficult decisions. They have no leeway in balancing the city budget, just as the Mississippi constitution requires a balanced state budget. Hopefully, revenue collections will improve. If not, city officials are obligated to follow through on budget cuts.

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