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City of Eugene, Oregon Fiscal Year 2007 Budget Message <br />~,,;;> <br />~y. _. <br />Mayor Piercy, Budget Committee Members and Eugene Citizens: <br />The FY2007 Budget I present. to you today is the product of past <br />achievements, current work, and future priorities. This $439.6 million <br />proposed budget is a balanced financial plan that has been carefully <br />prepared to provide Eugene with a sustainable set of municipal services. <br />It recommends some service enhancements that meet the critical needs <br />of our growing city, furthers work on City Council priorities and action <br />plans, and fills gaps created by austere budgets in previous fiscal years. <br />Budget Environment <br />This budget is just 2.2% larger than the budget I proposed to you last spring. Thankfully, the rate <br />of growth of operating costs has slowed significantly, due in large part to the City's actions in <br />pursuing structural changes in the public employee retirement system that were implemented by <br />the 2003 Legislative Assembly and later upheld by the courts. There are two types of savings <br />resulting from the retirement rate reduction: ongoing cost reductions estimated at $5.0 million per <br />year across all funds and $2.8 million in the General Fund, and one-time savings of $10.4 million <br />($6.0 million in the General Fund) stemming from FY04 and FY05 funds set aside to pay the <br />higher PERS rate in the event the courts ruled against the retirement reforms. These ongoing <br />savings are the primary reason we are able to recommend adding some services next fiscal year. <br />Our health insurance cost increases have also slowed and I am hopeful that recent changes in the <br />administration of our health insurance plan will continue to provide quality health care at more <br />affordable rates. <br />Eugene's economy is doing well. The city is reaping the benefits and facing the challenges <br />associated with growth. Our downtown is on the brink of momentous change that could increase <br />the vibrancy, attractiveness, and desirability of downtown as a destination for both citizens and <br />visitors to our city. Several exciting proposals with great potential to change the landscape of our <br />downtown are being discussed or are underway. A stunning architectural landmark, the new <br />Wayne Morse Federal Courthouse, will be completed this fall. Existing businesses are sprucing <br />up their buildings. New businesses are choosing to invest and locate in downtown, and new <br />housing projects are bringing people back downtown to live and work. The City's policies of <br />compact urban growth and downtown revitalization are making a difference. <br />2005-2006: A Year of Focus and Achievement <br />In 2005, the City Council ratified the City's mission and goals and identified eight City Council <br />priorities and related action plans. These two-year action plans became the focus of the City's <br />strategic planning efforts and the progress we made in 2005 on addressing these priorities was <br />significant. The City Council revisited its priorities in 2006 and celebrated the attainment of one <br />1 <br />City Manager Dennis Taylor <br />