Ludlow Leaders Discuss Plans to Climb Out of Financial Troubles
The City of Ludlow continues to take measures to stave off the impacts of its budget crunch.
Police Chief and interim city manager Scott Smith explained some of the steps being taken to address the city's budget shortfall.
"The reality of the financial struggle: it's real," Smith said. "The banks say it's real, (Kentucky League of Cities) says it's real, and we're dealing with it the best we can."
Smith took over as city administrator after Mayor Josh Boone fired Elishia Chamberlain. Reasons for her firing have not been shared publicly yet.
The city also laid off two public works employees, including the department's manager, cutting the department in half. It was reported on Thursday that the department would use inmates from the Campbell County Detention Center to assist the city in its public works tasks. The practice was used before until Smith stopped it noting troubles with supervision of the inmates. The public works employees will be attending supervision training at the Campbell County jail soon.
An administrative assistant was also let go, and when a police officer retires in the fall, Smith said he was unsure whether the position would be filled.
"We put a hold on everything," Smith said. "The riverwalk, everything, we put a pause on them. (Most) require a financial match, and we don't have it right now." A pause was also placed on the work to improve Adela Street, which also required a city contribution.
Smith reiterated that there are no more mobile phone reimbursements, no cleaning service at the city building, no bottled water service, and employees will be contributing more for health insurance coverage.
Smith said the city is working with Kentucky League of Cities (KLC) on a new health insurance plan, which he hopes could save between $8 and $9,000 per month.
"We're doing everything we can to reduce (spending)," Smith said. "We've cut as much as we can."
The city is bringing in an accountant to review its financial information ahead of an annual audit. KLC is also helping.
Smith said that the financial problem developed years ago and that there was no reason to blame any individual, even noting that he himself may have request spending on behalf of the police department without fully realizing Ludlow's financial position.
It could take about two years before everything is back in order, he said.
"The City of Ludlow will be in the long run and the employees are going to pay for it. They are going to pay the price until we get it back," Smith said.
Now that cuts have been made, the search turns to increased revenue. The city already increased its insurance premium tax by 2 percent. Franchise fees, which Smith said had not been collected by the city in ten years, would also be sought. Smith said that the city may bill for the past five years, which could generate $540,000. "The bills didn't go out on our end," he said. "Do we hope they just pay them? Absolutely. But the reality of it is, we don't know the speed at which we will receive our money." He said the focus on collecting franchise fees going forward could lead to an additional $96,000 in the city's budget each year.
Councilman Tom Amann applauded the work that Smith has done so far, noting that the police chief has "been putting in ungodly hours." "We are willing to work with you. We are all in this together, and together we will get out of it," Amann said. "It will be a much better city."
"The chief didn't say this but I think it's worth noting," Amann continued. "Just the things he did with the mayor's approval in the last month is saving $30,926 a month and will save $371,000 over the total year."
The city recently landed a contract to provide the City of Bromley with fire and EMS service, which will be overseen by newly sworn-in fire chief Mike Stewart.
"We want to get to the point where we have a contingency fund that is three times our operating expenses and when we get to that point, we'll be in really good shape," Amann said. "It's a hard thing to let good people go, but it's reality, and we will get through this."