Fort Smith directors critical of cost-cutting process

Fort Smith City Administrator Dennis Kelly’s ongoing process to cut the budget is not meeting with complete approval from at least three Fort Smith city directors.

On June 23, Kelly issued a memo to all city employees letting them know the city faces a $412,117 shortfall in the general budget. The memo set out a series of meetings between June 28 and July 8 to seek their input on how to cut the budget.

City employees are asked to rank cost-cutting options in order of most preferred to least preferred, and there is a space at the bottom to include other expense-cutting suggestions. The choices include letting the city make up the shortfall by reducing the amount paid for employee benefits, requiring employees to take unpaid days off, possibly once a month, taking a pay cut, or by eliminating positions through layoffs.

The pay cuts listed in the survey would equal 0.5% for employees who earn between $30,000 and $40,000; 0.75% for employees who earn between $40,000 and $60,000; and a 1% reduction for those who make more than $60,000.

Information gathered during the meetings and from the surveys will be used to package a plan Kelly will then present to the board.

Several sources tell The City Wire that Kelly’s move has upset some department heads who believe the necessary cuts could be made without asking employees to choose between layoffs, furloughs, and salary and benefit reductions. The sources said Kelly is saying the city directors said the public should see the city employees face some of the same tough decisions faced by private sector workers during the national recession. (Efforts to contact Kelly were unsuccessful.)

At least three city directors — Gary Campbell, Andre Good and Kevin Settle — aren’t comfortable with Kelly’s approach to the cost cutting.

Settle said during the board’s Tuesday (June 29) study session that he would like to conduct a special session about the process. Directing his comment at Kelly, Settle said asking employees to cut back should be the last resort.

“We need to look at other areas first,” Settle said.

Kelly requested the special session be held after city staff prepares a report on the cost-cutting proposals. The board consented.

Good said after the meeting he also has heard Kelly is saying the city board pushed him into the cost-cutting process launched June 23.

“I can’t recall that we asked for that, specifically,” Good told The City Wire, adding that he believes Kelly “probably meant well” but the approach is “not a good decision.”

Campbell agrees. He said instead of forcing options down from the top, Kelly should have sought solutions up from the employees.

“I would not go to the employees and ask, ‘How do you want to cut your pay?’ I would turn that around. … The employees know more about the operation of the city than anybody else. Let’s hear from them first before we do something like this,” Campbell explained.

The board may soon have a chance to quiz Kelly about the cost-cutting process. The board’s July 6 regular board meeting will include an executive session to continue the discussion of Kelly’s job performance.