KANSAS CITY, Mo. — The deep freeze and snow hanging on across the metro aren’t the only things sending a shiver through city hall. Some leaders get another chill when they think about the budget and Kansas City’s financial security.
Kansas City councilwoman Katheryn Shields joins FOX4’s John Holt and The Kansas City Star’s Dave Helling this week to weigh in on steps the city is considering as it tries to cut millions in spending to balance its budget.
Shields believes the city council didn’t do enough before passing last year’s budget in March. She points out that COVID-19 was already sweeping the U.S. and Kansas City was facing a pandemic. According to Shields, with unemployment spiking and businesses closing, there were already signs that revenues were going to suffer.
“Our budget director assured me that we were not going to be impacted seriously by this COVID. It just wasn’t going to be that serious. We did not need to make any adjustments to the budget we passed last spring,” Shields said. “Of course that turned out to be wrong.”
Wrong, to the tune of millions of dollars. Shields said by August, council members were told if they didn’t take action, the city would need to use $35 million dollars of its reserves.
“We cut about 4% or so from every budget except police and fire, and cut about $20 million,” Shields said. “Well we cut about $20 million and yet the latest report from city staff is that we’re going to end this budget year having used up $50 million dollars of our reserve.”
If that happens, the city will have used two-thirds of its reserves in 12 months. That leaves about $50 million in the bank. Shields says that covers just a single month of Kansas City’s bills.
During 4Star Politics with Holt and Helling, Helling said she’s concerned that a similar situation could happen again during the new fiscal year.
“We have revenue projections that I think are a little optimistic,” Shields said. “I just don’t know if we’re being cautions enough.”
Councilwoman Shields says while the plan is to cut more than 4% of the Police Department’s budget, the city needs to renegotiate with the Fire Department. Under the proposed budget, Kansas City’s Fire Department will get a 12% increase. It’s something Shields says the city can’t afford.
“This financial situation is real,” Shields said. Even if the city and finance department are correct, we have a very serious situation. I have also said to city manager and mayor that I don’t think we should be going even a dollar more into our reserves.”
Hear more from Shields on the city’s financial future and how the city’s earnings tax plays into the equation, in the video player above.
FOX4 and The Kansas City Star are partnering to bring you 4Star Politics, a special digital venture with new episodes released Wednesdays at 5 p.m.