Astoria plans $46.9 million budget amid pandemic

Published 1:30 pm Monday, June 1, 2020

Astoria is planning a $46.9 million budget next fiscal year with cuts likely coming due to economic fallout from the coronavirus pandemic.

Local governments are required to complete budgets by the end of the month. The City Council recently reached a consensus that presenting a routine budget and cutting it as necessary would be easier.

City Manager Brett Estes acknowledged in a recent budget hearing the precarious position of complying with state law while not knowing what sort of resources will be available.

“There is broad acceptance a recession is imminent, but the severity is hard to predict with the limited information available today and the largest drivers being how long current restrictions remain in place and how economic systems recover and respond to lifting restrictions,” Estes said in his budget message.

Short-term lodging in Astoria is set to restart Friday at 60% capacity. Lodging could reach full capacity June 25 if the virus situation does not worsen.

“The travel industry is the fastest to bounce back, and as soon as we get open, and as fast as they can have occupancy at 100%, we’ll be recovering,” Susan Brooks, the city’s finance director, said of lodging tax revenue during budget hearings.

Lodging and gas tax revenue are expected to flatline or decrease significantly because of a stay-at-home order, Estes said, while marijuana and alcohol taxes will likely increase.

Adding to the uncertainty is how the anticipated recession will affect property tax payments, which provide nearly half of the city’s budgeted revenue. Also uncertain is how much emergency relief Astoria and other cities could receive through the Federal Emergency Management Agency, along with state and federal legislation.

“The budget has been prepared to ensure core services remain intact for the health and safety of our citizens understanding aggressive (oversight) of the economic landscape and spending will be required to ensure we remain within our means,” Estes said.

The city employs around 100 people full time. The city’s part-time workforce, usually between 100 and 120 people, has been cut to between 10 and 20 people who are helping maintain the city’s parks, cemeteries, public spaces and emergency child care.

The city anticipates a nearly $409,000 increase in expenses, mostly in increased wages and benefits for staff, along with a full-time human resources position. It will spend down more than $740,000 of its reserve balance — critical for meeting payroll until property taxes come in — throughout the year to ensure vital services continue.

The city projects more than a $1.3 million increase in resources over this year because of increases in property taxes and curtailed spending during the pandemic.

It also expects to net $165,000 by selling higher-priced carbon buffer credits from its forest preserve east of town and buying cheaper credits on the open market. The city receives carbon reduction credits for limiting logging on a large swath of forestlands. Buffer credits provide the city insurance against fires that damage trees and release carbon into the atmosphere.

Possibly the most scrutinized will be the $3 million projected budget for the Parks and Recreation Department, largely shuttered during the pandemic. About 30% of the parks budget depends on transfers from the general fund, with another 15% from lodging taxes.

The city has prioritized providing child care through its Lil’ Sprouts program as people return to work and private providers struggle. Mayor Bruce Jones and City Councilor Tom Brownson recently signaled their support for asking the state to cancel a planned 75-cent increase of the minimum wage in July to limit the burden on the city and other businesses hit by the pandemic.

The city’s budget committee recently approved the proposed budget, which goes before the City Council later this month for adoption. The City Council will likely review and adjust the budget monthly moving forward, Estes said.