Whitehorse projects year-end deficit

The global financial crisis has hit home for the City of Whitehorse, which is projecting a $457,000 year-end deficit and forcing city managers to tighten spending.

With interest rates near zero, the city's investment income is down to just a fraction of what was budgeted, administrative director Robert Fendrick told council Monday night.

"Overall, really, it's a difficult scenario caused by global conditions," Fendrick said.

"We've had to revise that budget significantly, but it has basically devastated our bottom line."

Fendrick told council that federal gas tax funding has fallen through on certain projects, plus millions of dollars in city real estate along the waterfront remains unsold.

Municipal employee overtime and seasonal jobs are now on the line, Fendrick said.

"What senior management will be putting in place is a clampdown on any discretionary expenditures," he said. "We'll also be laying off sooner than we normally would probably for seasonal staff."

Reserves are still available to help the city weather emergencies, but Fendrick said the snow removal budget is already two-thirds spent for this winter.

"I would suggest we all pray for no snow at this point and that would really help our budget," he told council.

Fendrick said the projected deficit of $457,000 will be revised when September budget figures are tallied next month.