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Town council tussles with budget questions

Addressing the Pagosa Springs Town Council, during a budget work session last Thursday, Police Chief Jim Saunders said, “I’ve been talking with my colleagues back here and, we can’t in good conscience accept a refund on furlough days or a one-percent pay-per-performance bonus when people’s livelihoods are in the balance.”

Saunders was not just referring to a proposition, made by council member Mark Weiler, to compensate town staff for money lost due to mandated furlough days (to the tune of $11,265.93 for days off) and a proposed one-percent bonus amounting to $13,932.87, but to a proposed total of 2.53 full-time employees (FTE) eliminated in the town’s move to cut its budget by10 percent, relative to 2008 expenditures.

In the budget reduction scheme proposed by Town Manager David Mitchem last Thursday, two full-time positions would be eliminated from town staff: A full-time position from the police department, a full-time position from the parks and recreation department, along with part-time positions from the town courts and the community center, amounting to 2.53 FTEs equaling $100,000 in savings to the town. Mitchem added that, with a 20-percent reduction in the budget (due, by policy, to kick in with a two-month decrease in sales tax revenues of over 15 percent relative to the previous year’s revenues) would entail another FTE reduction, also from the police department.

According to Mitchem, the town of Pagosa Springs is doing well despite stringent economic times.

“We’ve got healthy reserves,” he said. “We can operate for six months without revenues on the general fund side, five months on the capital side.”

According to Mitchem, town reserves grew more than $550,000 during the past year, exclusively due to the town’s conservative approach to budget cuts (the town has been at a 15-percent reduction from 2008 expenditures.

While the town has suffered revenue declines throughout the year (now down 8.8 percent from the previous year), reserves predicate zero revenues — the town’s ability to operate at a 100-percent reduction, or no money coming in.

Last April, auditor Mike Branch stated that, while the town was, “In good shape, as far as reserves are concerned,” he added that, while the town could operate for three months on the reserves it had (at that time), the best-case scenario was to be able to operate for six-months on reserves.

Based on Mitchem’s figures, the town has achieved that goal, in less than a year, despite continued declining sales tax revenues.

Mayor Ross Aragon, while impressed with increased reserves, expressed some doubts about proposals in the 10-percent reduction in the town’s budget. “I’d hoped we don’t have to go with staff reductions.”

“I am completely in agreement with Mayor Aragon,” said council member Shari Pierce. “I am not in favor of staff reductions.”

Council member Don Volger asked, given the amount added to reserves, if some of that money could be used to retain staff.

Council member Darrell Cotton took a different stand. “Government can’t be immune to the downturns in the economy. I’m not in favor of losing jobs but we need to face the realities of the economy. We can’t be any different than the guy on Main Street who can’t afford to keep people on.”

It was then that Weiler proposed his plan for compensating town staff.

“If I may,” he said, “I’d like to congratulate the entire town staff of Pagosa Springs for performing triage on a patient that was very sick. That patient is alive, because of them.

“The alternative budgets that you see here are the result of the continuing excellence on their part,” he added.

After proposing leasing capital equipment (rather than purchasing with cash), Weiler made a suggestion that placed a pall on the room — suggesting that Town Clerk April Hessman not only receive a $10,000 raise in 2010 but that, because of the “exemplary work” she had done the during the year, receive similar compensation for the previous year.

For a moment, the chambers stood silent as everyone digested the suggestion. Hessman was visibly struck, hiding her face in her hands.

As many times as council has gone into executive session during the past year, many times with questionable rationale, the question of Hessman’s pay raise would have been an appropriate moment, away from her and the 20 or so members sitting in the audience.

Finally, Pierce broke the silence, saying, “I can’t agree with that, Mark,” reminding council that Tamra Allen (former town planner and interim town manager) had reported to council last year that Hessman had agreed to her current wage, as commensurate with her skills.

Cotton weighed in, saying, “I don’t want to diminish any of the work shown by the staff… and I know I’m going to look like the ogre here… but I agree with Shari, we can’t pay a bonus. I think the public sector ought to feel the same pain as the private sector, from whom we take money. I don’t disagree that’s inequitable,” he said, referring to earlier statements by Weiler regarding Hessman’s performance, realative to her pay but added, “When you backfill one, it sends a message that you don’t care about the others.”

Despite Hessman’s reaction (and her refusal to comment when called on by Aragon), it was confirmed later, by Mitchem, that she and Mitchem both knew that Weiler would raise the matter of her pay during the work session — and in front of all in attendance.

An odd meeting, with strange diversions from protocol, the meeting was abruptly ended after Saunder’s statement to council.

“I move that we adjourn,” Cotton said, “I have all I need.”

“I admit, I need to look closer at this,” Volger said.

With that, Aragon called the work session closed. Council meets again at 5 p.m. Tuesday, Dec. 15, to further discuss the 2010 budget, presumably to decide if anyone gets a raise — and who will get a pink slip, just in time for Christmas.