Lexington council passes $378 million budget. Find out what it funds, what it cuts.
The Lexington-Fayette Urban County Council voted unanimously Thursday to approve a $378 million spending plan that includes funding for affordable housing, $2.5 million for small business relief and more than $12 million in cuts across city government.
It includes no layoffs or furloughs for the city’s more than 3,000 employees. It also does not include any tax hikes.
Lexington Mayor Linda Gorton proposed a lean $372 million general fund budget for the fiscal year that begins July 1. The city is projecting a more than $40 million revenue shortfall over the next 12 months due to coronavirus-related business shutdowns and job losses.
To plug that shortfall, Gorton proposed taking $30.2 million from various city savings accounts, including $13.6 million from a $35.6 million economic contingency fund and $9.4 million from an $11 million reserve fund for payments into the state’s beleaguered pension fund.
Gorton’s original budget also cut more than $6 million to outside agencies, including $2.1 million to extended social resource grants, which typically funds homeless and domestic violence shelters for women and children and other social service agencies. Gorton’s budget also cut the city’s affordable housing program by $1.8 million.
The cuts to social service agencies, homelessness and housing programs drew fire from many advocates and some on the council.
The council voted June 2 to restore $2.1 million to the budget for the extended social resource program and added $1.8 million to affordable housing. That program will now have $2 million, which advocates say could build or remodel 800 affordable housing units.
The council has also added an additional $2.5 million for a small business grant program to help Fayette County small businesses struggling due to the economic downturn caused by the coronavirus. Roughly half of those funds will be earmarked for minority-owned and women-owned businesses, which have been hit particularly hard by the downturn.
The details of how that new grant program will work — including what types of businesses will qualify— has not yet been decided.
The city will temporarily use $6.4 million from the city’s economic contingency fund for the extended social resource grants, affordable housing programs and the small business relief program. The city will then replenish those rainy day funds with up to $25 million in reimbursements from federal stimulus funds for COVID-19 related expenses.
The budget also freezes more than 47 open positions and only includes $7.6 million in borrowing. The budget includes no new money for capital projects and only $5 million in bond money for paving. That’s much less than the $7 million in borrowing for paving in the current-year budget.
This story was originally published June 12, 2020 at 8:44 AM.
