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City back to square one on budget after hasty retreat on Fire Fee

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IF LAST week’s meeting was any indication, Mayor Eddie DeLoach’s warning the day prior of potential extreme cuts in City services if the controversial Fire Fee is reduced by half seemed to take many Council members on both sides of the debate by surprise. 

The clock is now ticking, as the decision means Council and City Manager Rob Hernandez must come up with a new budget in about two weeks, before the next fiscal year’s millage rates must be set according to state law.

Mayor DeLoach said at the regular Thursday meeting that he has directed City Manager to “Modify the numbers and bring us something forward so people can feel better about” the Fire Fee. 

At Wednesday’s impromptu solo press conference, DeLoach apologized for bringing “too much change too fast” and said the City was no going to “Plan B.”

However, the Mayor’s Plan B might not be much better received than the Fire Fee itself.

The Mayor said he would support cutting the Fire Fee by half — down to $120 per single-family house per year — but that draconian budget cuts might result, including laying off as many as five percent of City employees.

The about-face by the Mayor came shortly after the Tourism Leadership Council and the Chamber of Commerce released survey results of their business members, almost all of whom were in forceful opposition to the new Fire Fee.

That opposition came on the heels of organized opposition from citizens and clergy alike. Some of the latter would see their tax-exempt churches pay as much as $10-15,000 per year in Fire Fees.

Alderman Van Johnson responded that while he was “blindsided” by the Mayor’s press conference, he commended the Mayor for his “chutzpah” in admitting the policy needed changing.

Alderman Tony Thomas accused the Mayor of “throwing the City Manager under the bus.” 

“You outlined a plan... but I don’t know if the City Manager has analyzed that plan,” Thomas said.

Several Council members, including Alderman Bill Durrence and Alderwoman Estella Shabazz, insinuated that they had no idea the Mayor’s Wednesday announcement was coming. 

Most Council members were reluctant to back any of DeLoach’s specific suggestions, especially the idea of cutting five percent of the City workforce.

A lengthy back-and-forth included Johnson directly telling the Mayor that “We warned you that this would be unpopular. We warned you that this would affect poor folks. We warned you that this would affect nonprofits.”

One citizen spoke to Council briefly about the issue.

Rick Ellison, President of Retirees Unite For the Future, told Council that  “Savannah’s going to hell in a handbasket.... we’re getting killed by taxes from the school board, killed by the Fire Fee, and killed by the parking rates downtown.”

When Alderman Julian Miller tried to explain that the school board’s proposed 16 percent tax hike largely had nothing to do with the City’s Fire Fee, Alderman Johnson responded that “those of us who’ve been up here for a while” — meaning himself and Alderman Thomas — “understand that all these things are interconnected” in the public mind. 

In explaining the difficulties of redoing the budget to conform to the newly reduced Fire Fee, City Manager Hernandez at one point became visibly frustrated with Mayor and Council. 

“I need you to be very clear... as to what the rules of engagement are in bringing you options and recommendations,” he said. 

If the Fire Fee is reduced as the Mayor directed, “I have to make up $11.2 million in revenue this fiscal year” which is already halfway over, he said. 

“I need you to clarify what’s in play and what’s not in play,” Hernandez said.

Hernandez explicitly urged Council not to suggest that he direct the $10 million revenue surplus toward reducing the Fire Fee. 

“It is not prudent to use one-time money to go toward recurring expenses,” he said of the surplus, which has already been earmarked for other purposes in previous Council votes. “It would come back to bite us at some point in the future.”

In addition, the surplus has essentially already been spent.

The unforeseen windfall has already been earmarked for budget items including $1.5 million to the fund balance, $2 million to the Cultural Arts Center, $1 million to return Montgomery Street to two-way traffic, $1.4 million to pay down debt on the Fairgrounds purchase, $1 million for a controversial early childhood center, $500,000 for more malware response software due to the recent virus attack, and ironically, $600,000 in “wage adjustment reserve for police and — firefighters.

Council is expecting to take up the City Manager’s options at a budget retreat June 18. Hernandez was tasked to include an option without a Fire Fee at all. 

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