Valley’s city governments feeling pinch

By Mike Trask

Wednesday, Oct. 22, 2008 | 2 a.m.

Phil Stoeckinger can at least joke about it.

“The last time you saw me I had a full head of hair,” the North Las Vegas finance director said. “Now I’m bald and gray.”

Not really. Stoeckinger still has his red tuft. But he and his fellow municipal finance mavens are facing a stressful battle in the weeks following record lows on Wall Street as local city halls feel the financial pinch.

Stoeckinger then gets money-guy serious. He’s trained for it. It’s been his job for more than six years to keep North Las Vegas financially sound. Before that he spent six years working in Henderson’s finance department. Sure, the job is a little tougher in a tough economy. But “that’s the job.”

The largest suburban governments in the region — Henderson and North Las Vegas — are facing pressing budgetary concerns at a time when their residents are tightening their belts.

“People just aren’t buying as much,” said Cindy Herman, a Henderson spokeswoman.

The decreased spending directly reduces the amount of consolidated tax revenue going to municipalities.

Henderson, home to the largest retail corridor in the state, has seen its consolidated tax revenue drop 6.6 percent — about $500,000 — from July 2007 to July 2008.

Consolidated tax revenue, more than 90 percent of which comes from sales tax paid in the city, accounts for more than half of Henderson’s operating budget. With people buying fewer cars and making fewer trips to the mall, Henderson has a $28.2 million budget shortfall.

North Las Vegas has also seen a sharp drop in consolidated tax revenue, down 9 percent — about $350,000 — from last July. Consolidated tax revenue is more than 25 percent of the city’s general fund budget.

North Las Vegas officials expect to have a shortfall, but hesitate to predict the amount. They are waiting until later this year when first-quarter revenue figures are available.

The suburban struggles follow recent cost-cutting in Las Vegas as it faces a $150 million budget shortfall over the next five years. The deficit will likely mean cutbacks in city services, reduced benefits for employees and possibly layoffs.

Las Vegas is outlining a series of changes to enhance revenue, make government more efficient and reduce labor costs to try to keep the city financially solvent through the economic slump.

Henderson, the state’s second-largest city, is holding meetings with department heads to find a way to slash budgets by about 10 percent. Its leaders are using “everything’s on the table” rhetoric, although it seems public safety departments are last on the list for chopping.

Henderson has instituted a hiring freeze that could save about $6 million, while reassessing vehicle purchases and insurance payments in an effort to save another roughly $3.5 million.

Henderson will likely delay several capital improvement projects, including a $1.2 million police training facility. It will also save nearly $500,000 by delaying production of a planned half-hour television show that aimed to increase the city’s profile.

North Las Vegas was in a hiring freeze when the economy hit record lows last week.

The city froze hiring for the year (except in public safety) and cut its supplies and services budget 7 percent for last year’s operating budget of $480 million.

Stoeckinger said the city is reprioritizing capital improvement projects and considering employee sharing into pension and health care contributions.

Those decisions will likely be made before the end of the year.

“It’s one of the worst recessions we’ve seen in our lifetime,” he said.