LEWISTON — State budget cuts and a rough economy will leave the city with a $4 million hole in its fiscal 2010-11 budget, City Administrator Ed Barrett said Tuesday.

At a workshop meeting with councilors, Barrett tallied revenue cuts from the state, from lower-than-expected interest rate earnings and from one-time-only budget saving tricks used last year.

Combine that with some unforeseen expenses, and the council will begin their budget discussions with a $4 million deficit.

“There are really only three ways to deal with this,” Councilor John Butler said. “We can cut the budget, we can raise taxes or we use undesignated fund balances.”

Barrett outlined three places to start. The Lewiston Police Department’s practice has been to forgive the first parking ticket in a given year. Councilors last year approved a plan to eliminate that policy, but it didn’t get implemented. Barrett said it would save the city $10,000 if implemented right away.

He also asked councilors to confirm the previous council’s decision to eliminate spring cleanup this year. The current budget does not contain any money for a curbside collection or a brush collection, and Barrett said it’s critical that not change.

Barrett said a $25,000 effort to reduce streetlights saved only about $13,000.

“It got off to a slow start, and some lights were added back after residents complained,” Barrett said. He asked councilors to support efforts to swap the current lights with more energy-efficient bulbs, saving an estimated $50,000.

“These are things that will help with this year,” Barrett said. Expect more of the same next year, he said.

Revenue-sharing from state sales taxes are expected to be down $1.17 million for Lewiston in the 2010-11 fiscal year, Barrett said. That comes on the heels of a $900,000 reduction in the city in the current fiscal year. Lewiston is also expecting to see state road support down $113,000 next year, he said.

The state is also expected to reduce support for the schools, meaning a $1 million school surplus that helped reduce property taxes in this year’s budget won’t be available. And savings forecast from the city’s parking garages, sales of surplus properties and revenues from intergovernmental agreements didn’t materialize this year. Barrett doesn’t expect them to pay off next year, either. That’s another $170,000.

Last year, councilors used $1.2 million from the undesignated fund balance to reduce property taxes. Barrett said that withdrawal, plus a forecast $1 million deficit from June 2009 have lowered that fund balance significantly. The city could use $500,000 of that balance without hurting the city’s credit rating, he said.

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