Following up on Statesboro City Council’s mid-September decision to hold the city property tax rate at 8.625 mills instead of approving his recommended increase to 9.6 mills, City Manager Charles Penny has proposed more than $1.34 million in current-year budget cuts to the mayor and council.

These would be cuts to the city government’s fiscal year 2027 budget, which was approved by the council in June and has been in effect since July 1. Among other things, a $500 annual holiday bonus for the city’s employees, budgeted at $180,000 total, will be “suspended” this November, and some vacant positions will not be refilled.

Penny’s first suggestion for these cuts would also have completely “suspended” the Downtown Live concert series for spring-summer 2027, the Youth Connect program funded under the city’s Human Resources department and the Statesboro Village Builders initiative of the Youth Commission, as well as the city’s 2026 Christmas tree lighting ceremony. However, Mayor Jonathan McCollar on Tuesday requested, with informal support from council members, adding back about $121,000 for the two youth programs and a reduced Downtown Live series.

In Penny’s initial memo, dated Sept. 28, and a further note he signed and dated Oct. 1, he also recommends a salary freeze, but not for the current, July 2026–June 2027 fiscal year. City employees have already received the 2% “pay plan adjustment,” or across-the-board raise, that was included in the current budget. They also remain eligible for “pay for performance” raises based on their annual reviews during this fiscal year.

But Penny recommended a freeze on both types of raises for fiscal year 2028, in other words for the budget not written yet that will begin July 1, 2027.

With the millage rate held at 8.625 mills instead of being rolled back to offset inflation in property values, the city’s property tax is still estimated to be 22% higher than last year’s. But without the increase to 9.6 mills, that is projected to yield $1,341,600 less revenue than needed for the current general fund budget.

However, the general-fund bank balance — needed as a reserve against natural disasters and other unexpected events — has already fallen below the city’s policy of maintaining a balance of 25% of current-year spending, to about 20%, Penny said.

“It would be negligent on my part as a manager to not take steps to reduce our budget,” he said Tuesday. “The reason I say that is, at $6.5 million, we are at 20% on our fund balance, and to go down another $1.3 million would take us down to $5 million (or about 16%). We’re headed in the wrong direction.”

Rebuilding the balance would also take several years, he had told the council members and mayor in the Sept. 28 memo, which he summarized Tuesday.

“In order to compensate for the lack of revenue to fund the 2027 budget, I recommend reducing expenditures for the balance of the year and further reducing spending in fiscal year 2028 with salary freezes for fiscal 2028 budget, which means no pay adjustments with no pay for performance for a least one year,” he said.

Current-year cuts

What he called the “additional budget reductions” for the current fiscal year followed as a list of amounts by department and category, adding up to $1,344,055.

The largest cuts include the $180,000 for holiday bonuses, $200,800 from the Police Department, $340,138 from Public Works & Engineering, $179,456 listed under “Governing Body,” $103,420 from Planning & Code Enforcement, $77,500 from the Fire Department and $58,552 from Human Resources.

Another $100,000 wouldn’t actually be a cut, but a transfer, from the Solid Waste Collection fund, Penny said.

Although “governing body” means the mayor and council members, they would still be paid. But the out-of-town planning retreat they take with the manager and key staffers and any similar trips would also be “suspended” through next June 30. The $179,456 listed in the category includes other items not directly related to the elected officials but grouped there, such as funding for the Downtown Live series and some public relations spending such as publication of an annual report in magazine format, Penny said.

Smaller departmental cuts he listed include $16,145 from the Finance office, $1,550 from the Municipal Court, $17,500 from Customer Service, $11,997 from the City Clerk’s office, $13,996 from Village Builders, $27,591 from the City Manager’s office and $15,400 from Public Affairs.

Several of the categories include personnel vacancies that wouldn’t be refilled. Penny had arrived at these recommendations after requesting input from the department heads, he said.

“The reduction of the budget will result in the suspension of several activities in the community to avoid overtime expenditures,” he said. “I am recommending suspension of the Downtown Live series for 2027, suspension of the Youth Connect program, the Christmas tree lighting ceremony, … no Longest Table event. …”

KSBB vacancy extended

One continuing vacancy is the Keep Statesboro-Bulloch Beautiful position. After the city administration recently made someone an offer for this job and that person withdrew, Penny recommends that it be held open for the rest of the fiscal year, for a savings of $58,000.

In his Oct. 1 note to the elected officials, Penny stated that while the city continues its pay-for-performance raises this fiscal year “to be fair to all employees … they will be on notice for fiscal 2028.”

“It would have been easier to have adjusted the budget prior to its adoption, and some of the impacted programs may have been salvaged,” he wrote.

Outgoing manager

Speaking during the meeting Tuesday, Penny explained the timing of his advance recommendation now for a freeze on employee raises next year as related to his pending retirement.

“I share this with council, and none of these things are taken lightly, but as the outgoing city manager, it’s important for the new manager, whoever that’s going to be, not to have to do these things,” he said, “because what would happen is, with our employees, they would remember that the first action taken by the new manager was to reduce our budget.”

So, he added, the employees can be upset with him but should realize that the council has been very supportive of requests for their raises and benefits over the past five years.

Statesboro’s city manager since July 1, 2019, Penny had announced in early June that he intends to retire Jan. 1, 2027, thus giving over six months’ notice. The mayor and council have a special meeting called for 2 p.m. Friday, Oct. 9, as they continue their search for the next city manager. Most of it will be a closed-door session.

During discussion Tuesday, District 3 Councilmember Ginny Hendley said she thought Penny’s “recommendation was very wise,” but she still hoped some way could be found to “keep some of the things” such as the youth programs.

“The thing that I want to see completely and fully funded is the Youth Connect program,” Mayor McCollar began. “That’s very important for our young people, as well as the Village Builders. The Christmas event that we have downtown, I think that’s important. That’s a new tradition that we’ve begun, and I think right now with everything that’s going on in our community, in our state, in our nation, that people just need some levity, and then as far as the concert series, if we could reduce that budget to $50,000, those would be the adjustments that I would recommend.”

District 3 Councilmember Tangie Johnson also said she would like to maintain the youth programs.

Fewer concerts?

With six concerts, the Downtown Live budget is about $70,000 for the performers and staging, but another $13,000 is budgeted under public affairs for a marketing contract, making the series’ total cost about $90,000, Penny noted. He was recommending suspending the concert series for one year, not doing away with it altogether, he said, and as an alternative suggested reducing it to two concerts with a combined budget of $25,000.

But McCollar said he was still recommending a $50,000 budget for the concert series and said he will try to get some sponsors. The reduced concert series, a Christmas event and the youth programs, the mayor said, would add about $121,000 spending back to the budget, leaving about a $1.2 million reduction.

“I think it’s worth it for the morale. We need some Christmas,” Hendley said, and made a motion to adopt Penny’s recommendation with the mayor’s modifications. But that motion was never seconded, and after further discussion, McCollar said that it was withdrawn.

Participating by teleconference connection, District 5 Councilmember Shari Barr said the council then wouldn’t be telling staff specifically what to do but expressing priorities to Penny and asking him “to figure some more and come back to us.”

Barr said she liked the suggestion for two concerts and wishes something could be done about holiday bonuses because they are important for employees and their families.

Penny said he will propose an actual budget amendment at a future meeting.