09/20/1988 Meeting - Laserfiche WebLink

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e M I NUT E S Eugene City Council Dinner/Work Session Jacobs Room--Hult Center September 20, 1988 5:30 p.m. COUNCILORS PRESENT: Ruth Bascom, Rob Bennett, Freeman Holmer, Jeff Miller, Emi ly Schue. COUNCILORS ABSENT: Debra Ehrman, Roger Rutan, Cynthia Wooten. The adjourned meeting of September 19, 1988, of the Eugene City Council was called to order by Mayor Brian Obie. 1. KEY SERVICE AREA POLICIES A. Policy Framework and Financial Strategy City Manager Mike Gleason gave an overview of a document containing a draft mission statement and policies for key service areas supported by the City.s - General Fund. He said the policy statements and background material represent an initial effort to develop a policy framewo~k so the council can address the General Fund's financial problem. Mr. Gleason said the goal of the City is to balance the General Fund; it currently faces a deficit of $1 million to $1.5 million per year. The primary cause of this shortfall is that expenditures continue to increase while revenue does not. Expenditures increase for several reasons: the cost of services and wages go up annually, there are both internal and external service additions (e.g., wetlands, hazardous materials, celebrations), and increased service demands caused by growth of the city. Mr. Gleason said that in order for the General Fund to remain neutral, its baseline must increase by 3.5 percent per year. He said if the General Fund were not increased for one year, it would amount to a six-percent cut. In response to a question from Ms. Bascom, Mr. Gleason explained that a six- percent increase in property tax represents an increase of approximately 2.75 percent to the General Fund. This does not offset the difference between the increase in expenditures and the revenue. Ms. Bascom asked why the strengthening economy does not have more of a positive effect on the General Fund. Mr. Gleason said none of the revenue sources in Eugene are elastic; they do not grow at a rate equal to, or greater than, the growth of the general economy. e MINUTES--Eugene City Council September 20, 1988 Page 1