Mayor Greg Fischer announced at a news conference Friday morning that Louisville Tourism would pitch in $500,000 to keep the Belle of Louisville operating in the next fiscal year, which the mayor previously suggested could be shut down due to the city’s large budget shortfall and the failure to create new tax revenue.
However, that was the only bright spot in the mayor’s remarks, as Fischer outlined cuts that his administration has begun to implement as it works to finalize a proposed budget for the next fiscal year by April 25, which must find ways to deal with a $35 million shortfall.
Those initial cost-saving steps include the canceling of the new recruiting class of the Louisville Metro Police Department, increasing the health insurance premiums for city workers by 3%, along with increased deductibles and out-of-pocket expenses, and Parks & Recreation closing the city’s four outdoor pools this summer.
Additionally, Fischer said his administration is considering eliminating cost-of-living salary increases for all city employees next year and ending the city’s contract with ShotSpotter, a new technology that LMPD has used in recent years to detect and quickly respond to possible gunshots.
Continuing his argument over the last few months, Fischer said that the $35 million in cuts to come was not his choosing and not his fault, as he favored a significant tax increase for most types of insurance premiums to fill the budget shortfall and requiring fewer cuts — a plan that was finally rejected by a 11-15 vote of Metro Council.
“Unfortunately, this is our new reality, as directed by the majority of the council with their vote two weeks ago,” said Fischer.
In early February, Fischer released a list of $35 million in potential cuts that would be needed if Metro Council did not create any new tax revenue, which included a $1 million cut to end the city’s operation of the Belle of Louisville on the Ohio River and lay off 13 employees.
With the $500,000 provided from Louisville Tourism, the Belle of Louisville would be able to continue to operate next year, but Fischer said that “everything is on the table” when asked if his budget would pitch in an additional $500,000.
Fischer said that Louisville Tourism was partly able to make this contribution as a result of “the booming tourism we have in our city.” The department receives no direct funding from the city but is instead funded by revenue from a tax on hotel room stays and the new short-term rental tax from services like Airbnb.
Christa Ritchie of Louisville Tourism told Insider Louisville that their revenue from transient room taxes increased by 10 percent last year to $18.7 million — an increase of nearly $2 million. Because of state law, Metro Government receives none of that tax revenue.
Regarding the cancellation of the new LMPD recruiting class, Fischer said this was necessary because job offers would have needed to be made this month — before he had announced his proposed budget and two months before Metro Council will finalize a budget on June 25.
“It’s financially unwise to hire people without knowing that you have the budget to pay them,” said Fischer.
Fischer’s list of potential cuts from February included the possibility of 100 police officer positions being lost through attrition, creating $7.5 million in savings, in addition to $400,000 in potential savings from canceling the ShotSpotter service.
In addition to the immediate closure of the city’s four outdoor pools this summer — saying the timing is necessary because the hiring of lifeguards typically begins now — the mayor also announced that the Mary T. Meager Aquatic Center would increase its fees.
“I do not want to close the pools, but we have to hire people not knowing whether or not we’ll have a budget that will be approved to pay for those people,” said Fischer. “So those are the kinds of actions that we are being forced to take right now because the money’s not going to be there.”
Fischer’s list from February included the potential closure of four pools and attrition of 50 positions to save $223,000, along with the closure of four golf courses and 13 layoffs to save $550,000.
Asked by Insider Louisville if he also had plans to close city golf courses this summer, Fischer said such considerations would come after their “profitable” summer season.
“The time period when the golf courses are profitable is the summertime,” said Fischer. “So we want to get through the summertime with the golf courses and then we’re looking at things after the golfing season on how we could potentially repurpose some of the golf courses or turn them into more viable assets for us.”
This week, Fischer sent a letter to local unions representing over 4,000 city workers asking them to agree to a pay freeze in the next fiscal year in order to “help avoid more drastic cuts,” though several have responded by telling the mayor their members would not agree to this.
Asked about the requested pay freeze, Fischer said, “we have contracts with them that we’re certainly going to respect.”
“They’re responding that that’s not something they’re excited about, and I understand that,” said Fischer. “So we have to determine if that’s in play and if it’s not then we have to take a look at where else we can come up with reductions to the budget.”
Fischer’s list of potential cuts included 317 possible layoffs of city workers across many departments in the next fiscal year alone, as well as 246 additional positions lost through attrition.
Council President David James also spoke at the news conference, highlighting a new online form in which city workers can submit ideas on where departments can identify savings, without fear of reprisal from their supervisors.
The mayor is scheduled to present his proposed budget to Metro Council at its meeting on April 25, and the council must pass a final budget by June 25, the last meeting before the new fiscal year begins on July 1.
Councilman Bill Hollander, D-9, the chair of the budget committee, also spoke at the news conference and said the council would hold 30 public meetings on the budget and have three hearing devoted to taking comments from the public in the two months following the mayor’s budget proposal.
The mayor said that his administration had received no input from those who voted against the tax ordinance two weeks ago.
“This is not a budget that’s I’m putting forward by my own volition, I’m putting forth this budget because of the actions the council took,” said Fischer. “These cuts are on the folks that voted no… The fact that we have not received any ideas yet that are specific, that we can put into place, is concerning to me. Perhaps they will come forward.”
The council members that voted no — all seven Republicans and eight Democrats — have said that the $35 million in cuts could be found through identifying waste and efficiencies, along with reductions to “non-essential services” that exclude public safety, but have not unveiled a specific, detailed plan to do so.
Fischer pushed back at the belief that $35 million cuts would not affect public safety, noting that first responder agencies make up over 60 percent of the budget. He also said that libraries, the health department and the SummerWorks programs are also a vital part of the city’s public safety strategy.