A preliminary five-year financial forecast showed the city of Salem will face an estimated $18 million hole in its budget next year, indicating deep cuts to city services are imminent.  The forecast was presented Wednesday night as the city’s budget committee convened to begin discussions on the matter. The budgetary shortfall is expected to increase every year for the next four years because of inflation and expenses like employee salaries and benefits rising faster than property tax collections, which fund a majority of city services.  The news comes after a city poll showed Salem residents are not willing to pay more in taxes to avoid sweeping cuts to the city’s libraries, parks and emergency services. The polling showed that nearly 40% of residents said they were certain to vote no on a “livability levy” focused on libraries, Center 50+ and parks, or a public safety levy funding police, fire and emergency services. City councilors on Monday unanimously approved new three-year union contracts covering a majority of city employees that included cost-of-living raises and other benefits. Those are expected to cost Salem $25 million over the next three years. In poll, Salem residents say they won’t pay more property taxes for public safety, library or parks “The forecast shows a difficult financial path ahead for Salem’s general fund. We have a lot of work to do to build understanding and regain the trust of our community,” said Salem City Manager Keith Stahley in a statement. “While we work to set the priorities of the budget, all city employees must continue to be ’at your service‘ to the residents of Salem.” The forecast shows a significant hole for Salem’s general fund, which is supported mostly by local property taxes and covers a majority of city services. According to the release 80% of the city’s general fund is to pay employees who provide services to the community. City services funded by the general fund include police, fire, parks, libraries, Center 50+, community planning and development, finance, the City Manager’s Office, legal, and support services such as technology support, payroll, and building maintenance and services among others. Salem’s general fund budget is about $186 million this year.   The forecast also shows that other revenue-generating measures councilors have discussed would be insufficient on their own to close the gap. One popular idea is having the state of Oregon make an annual payment to compensate Salem for public safety costs associated with being the state capital. A proposal in the Legislature earlier this year would have generated about $5 million annually for Salem but failed to make it out of committee.  Gov. Tina Kotek said she supports the idea and Salem-area legislators have said they’ll try again in the 2025 session. The forecast will serve as a tool to help the budget committee understand financial trends moving forward and to help the committee decide what city services to prioritize once it is forced to decide where to make cuts.  In addition to future cuts to programs, the city said over the next several months it will conduct audits and oversight to find ways to save money, look into increasing user fees to fund certain programs, and will engage the community for insight and feedback.  The city said the current forecast showed the funding gap is expected to increase to $29 million by 2030.  In November, the budget committee, which is made up of the mayor, city councilors and nine community members will begin discussing priorities in preparation to cut services.  Budget committee meetings are open to the public and take place in the city council chambers at 555 Liberty Street S.E. Meetings can be watched on YouTube, and a meeting schedule is available online.  In April, Stahley will propose a budget for the upcoming year. The budget committee will work on refining the budget over a series of spring meetings. Salem City Council typically adopts a budget in June. All city budget committee meetings are public and take place at the council l chambers, 555 Liberty Street S.E.7301. See the committee’s website for scheduled meeting dates. Contact reporter Joe Siess: [email protected] or 503-335-7790.A MOMENT MORE, PLEASE – If you found this story useful, consider subscribing to Salem Reporter if you don’t already. Work such as this, done by local professionals, depends on community support from subscribers. Please take a moment and sign up now – easy and secure: SUBSCRIBE. The post Salem faces grim financial future with forecasted $18 million budget shortfall next year appeared first on Salem Reporter.