Memorandum

City of Lawrence

City Manager’s Office

To:	Mayor City Commissioners
From:	Dave Corliss City Manager
cc:	Debbie Van Saun, Asst. City Manager Ed Mullins, Finance Director Casey Liebst, Budget Manager
Date:	June 7, 2007
Re:	Reductions in 2007 expenditures

Attached please find two spreadsheets representing options for reducing expenditures in 2007 in order to improve the financial picture for the General Fund in 2008.  As noted in previous discussions about the 2008 budget, reducing expenditures in 2007 will aid our efforts in improving the structural imbalance between revenues and expenditures in the General Fund.

Spreadsheet A is staff’s recommendation for reducing 2007 expenditures to a level that is approximately 94% of budget.  With this target for 2007, and if revenues come close to our projections for the year, we will be able to realign the revenues and expenditures in 2007 and bring a healthier fund balance into 2008.  This recommendation includes a 6% reduction in the outside agencies funded from the General Fund, including the Health Department.

Spreadsheet B is Commissioner Chestnut’s recommendation for accomplishing a similar goal, however his version reduces the outside agency funding by 4% as well as includes a fourth quarter addition of the Auditor position.

Staff is recommending discussion of these options and others, as appropriate, as well as the formal adoption of reductions that can be put in place in 2007 in order to begin building our 2008 budget.

Action Request:  Approve a level of expenditure reductions in 2007 for the General Fund, (including the outside agencies), as appropriate.