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UPDATED Tacoma: Council set to consider fire union’s concessions, non-profit admissions tax plan

Post by Lewis Kamb / The News Tribune on Jan. 31, 2012 at 2:34 pm |
January 31, 2012 6:11 pm

UPDATE: 6:08 p.m

The council unanimously approved tonight the concessions agreement with the fire union. It also voted to table the admissions tax proposal to give members more time to review it. The admissions tax issue is set to go back before the council’s Government Performance and Finance Committee on Feb. 15.

Original post

In the city’s continuing saga of an ongoing fiscal crisis, Tacoma’s City Council is expected to consider two measures tonight to help the city trudge ever ahead in dealing with a projected $33 million budget gap.

One measure expected to go before the council tonight involves a proposed concession package from Tacoma’s fire union (which we wrote about here). As a way to help avoid a first-round of layoffs targeting 44 firefighters, the 360-member union has agreed to defer a 3.6 percent pay raise for its members in 2012, as well as make other concessions.

In all, the concessions total about $1.6 million in savings. When combined with the city’s recent elimination of 11 vacant fire positions and other council proposals to increase certain city fees and fines, union officials say enough savings have been achieved to spare the fire jobs at-risk for now.

The other measure set to go before council tonight involves a proposal to impose a new 5 percent admissions tax to tickets to nonprofit events. The proposed tax would apply only to nonprofits that make $250,000 or more in annual admissions (The TNT’s Craig Sailor previously wrote about the issue here). If approved, the new tax would kick in on July 1, 2012, raising the city an estimated $300,000 this year (and twice as much each year thereafter).

The council’s budget considerations are the latest in the city’s ongoing efforts seeking to trim another $13 million from the 2011-12 general fund. The council also discussed today a still-being-worked proposal to end a B&O tax exemption now enjoyed by nonprofit health care organizations, such as MultiCare.  The tax change could raise anywhere from about $188,000 to $1.9 million this year, depending on which tax rate the council ultimately decides to impose.

The council also received a tentative timeline showing when the city will determine how to reduce the amount of its external contracts with human services agencies and other organizations.  In all, the proposed cuts — now set to be decided by Feb. 7 — will seek to trim 10 percent of the city’s total outside contracts this year, or about $600,000.

Interim City Manager Rey Arellano said last week the city so far has made about $17 million in budget adjustments this month to address a projected $33 million gap in the 2011-12 general fund. When adding in more than $3 million in concessions offered from the police and fire unions, that still leaves a roughly $13 million hole.

A second-round of budget cuts now being planned by the end of March will seek to close the remaining shortfall, Arellano said. They’ll also likely result in more layoffs. And, despite the recent concessions offered by the public safety unions, police and fire jobs are likely to remain budget targets, city officials have warned.

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