View Full Version : Housing Bust Affects City Budgets

01-08-08, 11:37 AM
If not already, coming soon to a city or town near you: city revenues sharply down as home construction grinds to a near-halt. Say farewell to various city programs, grants, street repairs, fewer police and fire personnel, etc.

EJ says the rules will be changed to allow state deficit spending. I don't know what is typical at the city level.

BEND, Ore. - A sharp drop in home construction is putting pressures on the Bend city government, which gets much of its funding from building permits and inspection fees.

Until very recently Bend was one of the hottest real estate markets in the nation. But with fewer homes being built, revenue for the city planning office likely will be down about 60 percent for the fiscal year that will end in June.

That, in turn, puts a drain on budgets of other city departments.

Revenue from permits and inspections is expected to be only about a third of what it was in the previous fiscal year.

Budget shifts approved recently mean, among other things, that Bend will not be able to buy the eleven new police cruisers it had planned on or fill five vacant police department jobs. The fire department will leave two jobs empty.

Housing starts in November were the lowest they had been since early 1991. At one point Bend was issuing more single-family housing permits than San Diego.