Layoffs, furloughs and painful budget cuts -- three rare prospects in government -- might soon become the norm for counties and cities across the nation in the wake of the downturn triggered by the coronavirus crisis, a recent poll warns.
The bleak financial outlook is expected to impact locales across South Florida, from the bigger cities of Fort Lauderdale, Hollywood and Boca Raton to the smaller towns of Hallandale Beach, Cooper City and Southwest Ranches.
“There could be some tough decisions this year,” Fort Lauderdale Vice Mayor Steve Glassman said. “That’s all to come.”
Fort Lauderdale, the largest city in Broward County, is expecting to lose $19.2 million due to the COVID-19 pandemic alone. Hollywood is anticipating a loss of at least $4 million and neighboring Hallandale Beach is bracing for a $3.3 million hit.
They are not alone.
More than 2,100 cities are bracing for steep budget shortfalls for the fiscal year that ends on Sept. 30, according to a survey conducted by the National League of Cities and the U.S. Conference of Mayors. That represents nearly nine in 10 of the 2,463 cities surveyed.
Miami Beach, a tourist mecca drastically sidelined by the virus, has laid off more than 250 workers in the wake of the COVID-19 crisis. Even the city manager is taking a 10-day furlough.
In the coming weeks and months, cities across the region may be forced to slash both workers and public programs as the economy slows to a crawl.
Stay-at-home orders, a skyrocketing unemployment rate and business shutdowns needed to stem the spread of the killer virus are hurting the bottom line for cities dependent on tax revenue and fees.
Federal aid is on the way, but only cities with populations above 500,000 are eligible for direct funding under the $150 billion Coronavirus Relief Fund.
The money, part of the $2 trillion package President Trump signed into law last month, comes with restrictions and can only be used to help local governments cover costs in their response to the pandemic.
Smaller cities can access the money but must apply for help at the state level.
Hollywood Mayor Josh Levy says cities are mandated by law to balance their budgets -- and they’re going to need help.
“We’re going to look to our state and federal governments to make up the shortfall,” Levy said. “We recognize there will be a shortfall. We are looking at overcoming that in part through the assistance of state and federal dollars. The CARES Act will send money directly to cities with over 500,000 people Every city needs it fair share.”
If Congress does not step in, cities across the nation will be forced to make painful decisions “that will affect real people’s lives,” said Bryan Barnett, president of the United States Conference of Mayors and mayor of Rochester Hills in Michigan.
The survey found that 88% of the cities participating in the poll expect a revenue shortfall this year as a result of COVID-19; 55 percent of cities with populations of 50,000 to 500,000 say they will be forced to furlough employees; another 38% expect to lay off workers; and 52% say budget cuts will impact police and public safety.
With or without federal help, some cities will likely be forced to raid their emergency reserves.
Boca Raton officials are not currently talking furloughs or layoffs, according to city spokeswoman Chrissy Gibson. But the fiscal impact from the stranglehold COVID-19 has put on the local economy will likely be addressed in the coming weeks, she added.
In Fort Lauderdale, City Manager Chris Lagerbloom mentioned layoffs just two weeks ago. But this week, he told commissioners there might be a less painful solution if they tap into the city’s very healthy “rainy day” fund.
“Because of our healthy reserves we’re in good shape,” Glassman said. “That’s going to be very helpful.”
Another bright light: Fort Lauderdale is moving full steam ahead with plans for a new $100 million police headquarters and a $200 million parks bond approved by voters last year, Glassman said.
Like Fort Lauderdale, Hollywood has no intention of stalling plans to spend $165 million on a new police station, park upgrades and other improvements given the green light by voters last year.
“The bond projects will continue forward,” Levy said.
Layoffs won’t impact Hollywood City Hall, Levy said.
“We need our employees and they all have work to do,” he said. “There’s some reorganization that perhaps needs to take place. People might be doing a different job than they used to do.”
Here’s good news for residents: Homeowners in Hollywood, who already pay one of the highest property tax rates in the county, won’t have to worry about a tax hike, according to Levy.
“That’s the last resort,” he said. “I’d prefer to reduce expenditures than to ever think about raising property raises.”
Broward County, on the other hand, might be forced to hike its property tax rate to make ends meet. Monica Cepero, deputy administrator for the county, says it’s still too early to say whether the county will raise its tax rate to deal with shortfalls.
“We’re looking at everything, everything is on the table,” Cepero said. “We’ve already started looking at preliminary budget conversations and having our folks look at our services. Time is going to tell how soon things get rebounded and open back up.”
In Hallandale Beach, things have never been more bleak.
“We’re bracing for people not being able to afford to stay in their homes,” Mayor Joy Cooper said. “We’re concerned about rising unemployment rates.”
A plan to borrow money to buy crime-fighting surveillance cameras and spruce up sidewalks and street lighting is now on hold.
“The city manager brought up furloughs,” Cooper said. “We did do a hiring freeze. I said instead of furloughing a ton of people we might want to have people work part-time at home.”
Will the city be forced to hike the tax rate or other fees?
“Everything is on the table,” Cooper said. “As cities we have to balance our budget. We have to provide public safety, water and sewer. We are the life blood and the heart and soul of our communities.”
Susannah Bryan can be reached at [email protected] or 954-356-4554.
Lisa J. Huriash can be reached at [email protected] or 954-572-2008 or Twitter @LisaHuriash
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