Proposed budget in Lowell includes 22 job cuts

LOWELL -- City Manager Bernard Lynch found his fiscal skills handy last year when he was forced to plug a $6 million deficit almost immediately after taking office.

He says he's had to rely on those same skills in producing a balanced spending plan for fiscal 2008. It wasn't easy: His $288 million budget raises taxes, though at a lower rate than in the previous years. And it still includes job cuts.

"Property taxes will grow modestly next year, but to do that we've had to eliminate positions," said Lynch. "That's the agonizing part of creating this budget. We had no other options than to cut positions."

Overall, 22 jobs will be eliminated -- 11 through layoffs and the others through attrition. They will affect several departments, including the planning and development division, the library, and the Health Department.

The cuts will not affect the Police or Fire departments.

The City Council will hold public hearings on the plan Tuesday and Wednesday.

Mayor William Martin said he has not reviewed Lynch's budget in detail but is hoping that more job reductions can be achieved through attrition.

"That's one thing I'd like [the council] to look at," he said. "This budget is a very good first step, but I'm hopeful that we can eliminate more jobs without having to lay people off."

This is the first budget Lynch has prepared since he took office last July, but he's already faced pressure managing Lowell's finances. Within weeks of filling the role made vacant by the departure of John Cox, Lynch had to deal with an unexpected $6 million deficit in the fiscal 2007 budget.

Lynch, who had been town manager in Chelmsford before taking the Lowell job, found several ways to collect new revenue and save money. Among them, subsidized health insurance benefits for members of boards and commissions were eliminated, for a savings of about $400,000. Payment of back taxes resulting from the sale of the former L'Energia power plant on Tanner Street provided $2 million, and about $800,000 in revenue came from taxes on new development.

Lynch said those problems are in the rear view mirror.

"The problems arose from revenue projections that didn't materialize and costs that were being carried over from one year to the next," he said.

"We have different policies in place now so that we won't get into that hole again."

The new fiscal year, which begins July 1, will see several departmental changes at City Hall.

Lynch is combining the city's Parks and Recreation Department with the Department of Public Works. The new agency will be supervised by Assistant City Manager T.J. McCarthy. The current DPW commissioner, Edward Walsh, is scheduled to retire at the end of the year. Tom Bellegarde, the current parks commissioner, will report to McCarthy.

In addition, the city's financial offices will be grouped under a Finance Department. This new agency will include the assessors and treasurers departments, human resources, and purchasing. Tom Moses, Lowell's chief financial officer, will oversee the department.

Lynch's budget also creates a new assistant to the manager position at an $82,000-a-year salary. He said the assistant would take over some of the responsibilities handled by McCarthy and also provide support for the day-to-day operations of the office.

City Councilor Edward "Bud" Caulfield criticized the move.

"The city manager is saying to department heads that we have to hold down the budgets and watch spending, yet he's adding a new position," he said. "I can't support that. It's a huge contradiction."

Lynch said creating the new position does not add a new person to the payroll, since the current DPW head is retiring and, under the reorganization, the slot will be filled by McCarthy.

"T.J. is moving over to take on new responsibilities, so that leaves a vacancy which we'll fill," he said.

Property taxes will increase, though at a lower rate than in previous years. The bill for the owner of the average single-family home will grow by about $60, representing a 2.5 percent increase.

"This budget recognizes that residents have been seeing increases of 6 percent for the last five years," Lynch said. "People wanted to see some relief."

City Councilor George Ramirez praised Lynch for producing a budget that softens the tax burden for Lowell homeowners.

"He had to strike a balance between minimizing taxes and keeping everyone on the payroll," said Ramirez. "Unfortunately, he couldn't do both."

Alexander Reid can be reached at areid@globe.com.