KALAMAZOO, MI (WKZO AM/FM) — Declining tax revenue and an expected budget shortfall have prompted the City of Kalamazoo to temporarily cut back on its workforce during the COVID-19 pandemic.
The city’s budget is anticipated to lose millions of dollars, and the loss could result in impacts to departments like parks and recreation, as well as reductions to community services and road maintenance.
City Manager Jim Ritsema says that his office has been forced to make difficult decisions about where to allocate resources.
“As our workforce represents over two-thirds of our costs, this will have to be an area we look for reductions. This means our employees’ livelihoods are at stake and that is a difficult decision as a city manager to have to make,” said Ritsema.
He says that 25% of the Kalamazoo’s municipal workforce will be furloughed beginning on Monday, May 18th, and continuing until at least July 24th, with further cost reductions being considered to balance the city’s finances.
Another area of potential cutbacks is the city’s department of public safety, which makes up nearly half of all budget expenditures.
“If we must cut, there is little doubt that police and fire protection will carry part of the burden,” said Ritsema. “We have focused on the virus as a public safety issue, but daily police and fire service is just as vital in saving lives and our ability to provide a community where people can thrive and businesses can grow.”
Ritsema joined city managers from Saginaw, Midland, Muskegon, and Westland in a live webinar event on Thursday, where they discussed how each of their respective cities is dealing with budget challenges.
During the event organized by the Michigan Municipal League, the officials called on Congress to pass the federal HEROES Act which would provide $375 billion in funds to struggling cities across the country.
Michigan Municipal League CEO and Executive Dan Gilmartin said during the webinar that Michigan cities are expecting a 37.3% loss in revenue during the public health crisis, which could lead to disastrous consequences for city services.
“Frankly, we will see cities going bankrupt without this support, massive layoffs including police and fire that will endanger public safety, and an inability to meet the basic expectations of citizens. Congress needs to act quickly, and we hope all of our members are listening to city officials who are among the most respected of any elected officials,” said Gilmartin.
Kalamazoo facing a budget shortfall as it steps in to support local businesses and organizations affected by the outbreak.
In March the city commission approved a transfer from the Kalamazoo Foundation for Excellence to create a $2 million small business loan fund assisting local operations negatively impacted during the pandemic. The low-interest loans between $5,000 and $50,000 will go toward workplaces to support payroll expenses, mortgage payments, rent, and other costs to keep businesses afloat.
Earlier that month commissioners voted to give Ritsema the ability to approve contracts and make purchases called for in the city budget of up to $5 million if the city commission decided not to meet.
Ritsema says that city department offices will remain open, but that staffing cuts will likely lead to reduced hours at various locations.
