LOUISVILLE, KY (WAVE) - Louisville Metro is facing a four year, $65 million budget shortfall and Metro Council has a week determine a solution as they consider possible tax hikes and budget cuts.
The deficit is mostly due to increased state-imposed pension payments.
While tackling the issue, projects approved last year are in limbo.
Construction on city-funded projects halted after Mayor Greg Fischer said the city did not have any means for long-term financing without the approval of a $83 million bond.
Metro Council postponed the bond last Thursday.
“The possibility of this turning into something that could be a significant delay is really troubling,” Lee Burchfield, the Assistant Director for the Louisville Free Public Library system, said.
The Northeast Regional Library is a $17.8 million project to which the city committed $14 million. The project was approved last year when a 2018 Metro Louisville Project Report described a strong budget and touted city investments.
Another halted project is the Louisville Urban League’s sports complex. The city contributed $10 million.
“It was not right to say we are just not going to borrow any money to do anything,” Councilman Bill Hollander (D-District 9) said. “The right way to do this was to open the budget and pick which projects we don’t want to fund.”
Hollander voted for the bond to be approved. Other council members said they voted to table the ordinance to the slow the city's spending while the government gathered more information.
“I want to know -- are there any projects that maybe haven’t started yet that we may want to revisit before we approve the entirety of the ordinance,” Councilman Anthony Piagentini (R-District 19) said. “We are having the convo right now, but that did not necessitate the mayor to take the knee jerk reaction that he did.”
The council would have to amend the project list from last year’s capital budget in order to slow capital expenditures. According to Daniel Frockt, Louisville Metro’s CFO, “This isn’t a cash flow issue -- it is an authorization issue.”
The Northeast Regional Library is about three months away from completion, Burchfield said. While a few days without construction has not significantly affected the project, it is uncertain when work will resume and deadlines need to be met.
“If this delay pushes the construction date, then we have to talk about rescheduling work that we have already scheduled with other contractors, so it starts to get pretty complicated pretty fast,” Burchfield said.
Metro Council will vote on the bond ordinance at their next council meeting on March 21.