The budget absorbs spike in pension spending while funding paving, public safety, housing and other areas.
Updated: Apr 26, 2018 6:35 PM EDT
LOUISVILLE, Ky. (WDRB) – Louisville Mayor Greg Fischer submitted a budget for the coming year Thursday that absorbs higher pension and health care costs while setting aside more than half of the city’s general fund for police and other public safety agencies.
Fischer wants a record $2 million dedicated to the Office for Safe & Healthy Neighborhoods for anti-violence initiatives and proposes money to hire 145 Louisville Metro Police Department recruits to fill open positions. Overall, however, the budget calls for a slight drop in police spending.
“We’ve seen some good results relative to the reduction of crime in our city, so we’re going to invest more in developing our youth,” Fischer told reporters Thursday morning. “We’re going to develop more in making sure that we’re interrupting any type of potential violence that’s taking place in our city.”
Louisville posted record murders in 2016, and the city’s homicide total last year still was the second-highest on record. But through March, LMPD data shows violent crime has declined by nearly five percent when compared with the same months in 2017 and were at their lowest levels since 2015.
The budget includes $623.5 million in general fund spending, up from $595.6 million in the current fiscal year. It swells to $874 million once capital spending, debt service and other state and federal revenue sources are factored in.
Fischer presented the plan Thursday afternoon to the Metro Council, which announced it will hold three public hearings starting on May 9 and develop its version in the coming weeks.
Council Republicans and Democrats applauded aspects of the budget, including the mayor’s proposed investment in affordable housing and spending $3.4 million to address a backlog in maintenance at city buildings.
“In general, I’m at least pleased that the priorities of the council have been addressed in the budget proposal,” said council member Bill Hollander, a Democrat who chairs the budget committee.
The budget includes more than $40 million for road, sidewalk and related work, with about half of that spending on street paving.
“We’ve been persistent over several years of making infrastructure investment a priority,” said council member Angela Leet, a Republican who is running for mayor. “We did get a proposal that we’re pleased with in terms of a number. We’ll obviously be delving into the details of that.”
The mayor’s administration crafted the budget weeks after the Kentucky General Assembly capped the annual increase in retirement costs by Louisville Metro and other local governments at 12 percent. Without the reforms, the city faced as much as $39 million in additional pension costs during the fiscal year that starts in July.
Metro government now anticipates an increase of $9.4 million in those costs, combined with health care expenses rising by $9.6 million in the coming year as a result of higher drug prices and insurance claims connected to obesity, diabetes and other chronic conditions.
Taken together, health and retirement spending for public workers account for 22.5 percent of Metro government’s operating budget.
“It’s been a tough budget because of the increase in health care and pension costs, but we’ve been able to maintain investments in public safety and job creation and some of our quality of place efforts as well,” Fischer said.
Among those investments are $10 million for a track-and-field complex being developed by the Louisville Urban League in the city’s Russell neighborhood. City officials and the Urban League continue to work on a development agreement for the $30 million mixed-use project, said Daniel Frockt, Fischer’s chief financial officer.
Fischer’s budget also includes $250,000 for the YMCA at 18th and Broadway. In his address to council members, he said the “long overdue” investment in western neighborhoods is approaching $1 billion.
“I’m very happy for the investment that continues to be made in west Louisville, especially in the Russell neighborhood from one end to the other end,” said council member Cheri Bryant Hamilton, the chair of the council’s majority Democratic caucus.
Also part of Fischer’s $121.4 million capital projects budget are $3.85 million to finish the city’s northeast regional library next spring; $6 million to complete a new animal shelter in Newburg; $10 million for the Affordable Housing Trust Fund; and $2 million for Louisville CARES, a loan fund for developers of affordable housing.
Members of the Citizens of Louisville Organized and United Together, or CLOUT, attended the budget address in council chambers and held signs asking for $10 million for the trust fund. They gave Fischer a standing ovation when he said he was committing that amount in his proposal.
Rev. Reginald G. Barnes Sr., the group’s co-president, said he was pleased that Fischer provided “full funding” for the trust fund in the budget.
“We think that is a very critical piece to solving some of the issues here in Louisville. All of Louisville benefits from that,” Barnes said. “So we’re glad to hear that and we’re hoping that that will continue, that we can even at some point find a permanent funding source.”
Other parts of the budget include:
- $22.5 million for paving, sidewalk and separate bicycle lanes. Fischer said it’s the fourth year in a row with proposed spending of at least $20 million, and he defended spending $500,000 on bike lanes, noting their presence in other cities and emphasizing that tech giant Amazon sought out communities with them during its hunt for a second North American headquarters.
- Unspecified funding to move the police crime scene unit and crime information center from the LMPD headquarters building at Seventh and Jefferson streets. Chief Steve Conrad’s office would remain. “We’re going to be evaluating next steps on that, but eventually everybody will be out of the headquarters and there will be a new plan,” Fischer said.
Since at least 2016, the Fischer administration has weighed moving police from a downtown building that has been beset with water leaks and other plumbing problems while also housing a temporary jail.
The mayor told council members they will receive a long–awaited study next week that makes recommendations on where to move police offices. But there is no money in his budget plan for a new headquarters.
“I don’t know if the frustration on my part is so much that the money is not in the budget — as it is that we are just now in late April talking about a study that was supposed to have been finished back in January or February so that we could be talking about what we need to do to move forward,” said Republican council member Kevin Kramer, vice chair of the council’s budget committee.
He added: “My regret is that we didn’t have this conversation six months ago so that we could be moving forward in this budget cycle instead of this next one.”
Waterfront Development Corp.
- The mayor- and governor-appointed agency that oversees Louisville’s Waterfront Park would receive $987,000 in operating funds. It had asked for $1.3 million from the city as a way to make up for a loss of state funding that was pulled in 2014 and hasn’t returned.
Waterfront Botanical Gardens
- $350,000 for the botanical gardens project underway at River Road and Frankfort Avenue. State lawmakers directed the city to spend its share of mineral tax revenues on the project in the budget bill; Frockt said city officials are “looking at the legality” of that move.
Fischer said he does not expect any layoffs of city workers in the year ahead, but there could be a “thinning out” of government services as a result of jobs that will go unfilled due to retirements and other attrition in parks, public works, animal services and other departments.
Frockt also said the budget proposal doesn’t factor in additional state budget cuts of 6.25 percent to a broad swath of state government. As those reductions happen, he said, local services such as public health, public works and youth detention may be affected.