City looking at options to ease virus’ budget impact

BY CHUCK VANDENBERG
PCC EDITOR

FORT MADISON – Fort Madison city officials are looking at possibly furloughing employees to help salvage a crisis-riddled budget.

City Manager David Varley, who talked last week about the unknowns of the coronavirus’ impact to local government budgets, told Mayor Matt Mohrfeld this week if things get much worse the city may not be able to pay it’s bill in six months.

At Tuesday night’s teleconferenced City Council meeting, Mohrfeld put the issue in front of the council lfor recommendations.

“I met with Dave in our normal weekly update and he presented a budget projection that if things play out unfavorably, in six months we can’t pay the bills.” Mohrfeld said.

Mohrfeld started the conversation with the option of shuttering or delaying some city services including the pool and library. He also suggested furloughing some employees. Furloughing would be temporary and allow federal, state, and local health and economic experts to determine what the impact of the viral outbreak will be.

Another option would be to layoff employees and allow them to immediately apply for the accelerated unemployment program and possibly an additional $600 weekly stipend from the federal government.

According to the U.S. Department of Labor, the Federal Pandemic Unemployment Compensation, or FPUC, allows states to provide an additional $600 per week benefit to individuals who are collecting regular Unemployment Compensation. The payments are federally funded.

The payments under FPUC continue through the last week of regular unemployment before July 31, 2020 and would start back-dated to the individual’s original unemployment eligibility date, or the date the state signed the agreement with the Dept. of Labor, whichever is first.

For more information on the program, click here: https://www.dol.gov/newsroom/releases/eta/eta20200404

Councilwoman Rebecca Bowker said the city should look at asking for volunteers to furlough.

“Have we floated that by anyone or any department heads?”

Councilman Chad Cangas agreed with the voluntary furloughs, adding that some might welcome the chance to be at home right now.

“It’s a bad spot to be in, but we’re at a point where we have to look at stuff,” he said. “There are people that want to be at home because they are concerned about the pandemic. They don’t want to be at work, but they don’t have a choice.”

But Councilman Robert Morawitz said the city should consider taking out a loan as a gap funding measure to keep the city moving. He said the options of furloughing and laying people off put the onus of the problem on a few people. A loan could be assessed and cost everyone a few pennies, rather than city employees hundreds of thousands of dollars, he said.

Cangas said the city can’t operate with empty pockets and they are going to have to make some tough decisions, but he said he would like more information on the unemployment support because with the $600 added on maybe the employees aren’t taking that big of a hit financially.

Varley said the city should immediately begin cutting some of the consultation and professional services expenses that are planned, which would cut $30,000 to $40,000 out immediately, when coupled with reduced fuel costs.

“There’s no question about that,” he said.

Varley said he thinks the city can keep the library and the Old Fort open but all staff would have to be put on leave except directors Sarah Clendineng and Dr. Eugene Watkins. He said that, coupled with a tightening of budgets and the reduced fuel costs, could get the city through for the time being.

But furloughing Watkins, Varley said, could result in him quitting and taking 50 to 60% of the exhibits at the Fort, which are owned by him, with him. Varley said he’d almost rather fire Watkins than furlough him, and buy out his vacation. Then hire him back after the crisis has passed.

Varley said he has the authority as city manager to manage employees and he did send home library staff earlier this week with pay. But he said that pay was only guaranteed for one week and he wanted to reassess the situation.

Councilman Rusty Andrews said the council only meets every other two weeks and they’re going to have to rely on city staff to make decisions.

“We need more information before we can make decisions,” he said. “We’re gonna have to rely on Dave and the mayor to make some decisions. The city is going to lose income out of this, and we can’t forget that. As much as we care about our employees, we’ve got to still keep in the back of our minds finance.”

Bowker also encouraged Varley to seek FEMA reimbursement for some of the city’s COVID-related expenses. Varley said he is having city department heads use a worksheet to document all expenses going forward.

In an unrelated issue, Fire Chief Joey Herren told the council that he, along with Keokuk Fire Chief Gabe Rose, were deep into the process of trying to get authorized to help provide ambulance service in the county through the Fort Madison and Keokuk fire departments.

Lee County Emergency Medical Services, who currently provides countywide ambulance service, is operating week to week trying to sustain payroll with their contract ending on June 30. There has been no official word on whether the service plans to sign another contract, and conversation to this point has indicated it will not.

Herren said the state is fast tracking all his paperwork, but he still has some hurdles with Medicaid and Medicare who want a list of equipment, and the city has currently has none.

In other action, the board:
• Heard from Building Director Doug Krogmeier that the city has temporarily suspended rental inspection and most nuisance inspections to allow people to focus on virus mitigation and safety.

• approved, 7-0, a second reading of an ordinance to rezone property located at 1731 39th Street and the adjoining alley between 38th and 39th streets, as well as 1729 39th Street from single-family to service and wholesale district.

• approved, 7-0, the reappointment of Jody Schulte to the Southeast Iowa Regional Riverboat Commission and Joel Amandus to the city’s Planning and Zoning Commission.

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