Facing an $18.3 million deficit on its 2020 budget, the city of Arlington has implemented a plan to help itself recover from the effects of COVID-19.
City manager Trey Yelverton presented the five-phase plan at the April 14 Arlington City Council meeting.
The first three phases have already been implemented, he said. Phase one included freezing vacant positions for the rest of the year, suspending employee raises and freezing vehicle purchases, among other things.
Phase two included financial restructuring in the city’s park fees program, which collects fees for new developments in a certain zone for future park expansion and development.
Phase three included departmental reductions. Yelverton said at the April 14 meeting that the reductions they asked departments to make were positions they could manage between now and the end of the year.
That leads to phase four and five, which include using reserves and furloughs/layoffs. Yelverton said if the budget can’t get to where it needs to by the end of the fiscal year, using the reserves in phase four will help fill it in.
Phase five could help this fiscal year as well. However, it could potentially help more toward the fiscal year 2021, he said. If the city was to go ahead with furloughs/layoffs now, then there would only be savings for a few months, Yelverton said.
“Savings is what we need, but you don’t really get what we would call a full-year funding type savings,” he said. “Those type of measures would not only potentially us help this year, but more than likely it will help us going into fiscal [year 2021.]”
Yelverton said COVID-19’s impact on the budget will have effects on the fiscal year budgets for 2021 and 2022. He said the city’s budget works on a few main revenue streams, including property tax and sales tax, with sales tax being the one felt almost immediately.
Even with some businesses reopening, the city’s plan is set, and there are only a few instances where plans would change, he said.
Inaccurate revenue assumptions and possible federal or state assistance are just some aspects that could change the plan, Yelverton said.
“We’ve implemented it partially; we stand ready to implement it more fully if information dictates that,” he said.
Yelverton said the city is missing big economic generators like UTA and Six Flags Over Texas as well.
Now that UTA has transitioned to online classes due to COVID-19, the downtown area is missing the foot traffic that its students and staff provide when they eat at restaurants or shop around, he said.
With the Six Flags Over Texas park closed, the city is losing sales tax and hotel occupancy tax from people coming and staying in town, he said.
Jim Brothers, Six Flags Over Texas marketing director, said in an email that when the park does reopen it will adhere to the governmental guidelines.
Another business taking precautions and waiting for relief is Free Play, the arcade and bar company. The company has an Arlington location and four Metroplex locations in total, with another on the way.
Free Play president Corey Hyden said it’s been rough since they had to shut their doors in March. He said the shutdown couldn’t have come at a worse time, with March historically being their busiest month of the year.
After shutting down, the company put all its employees on disaster furlough and tried to think of other ways to generate revenue. The company sold gift cards, merchandise and even duplicate arcade machines it had, Hyden said.
“I mean, basically, we tried everything,” he said. “And we were pretty successful. We were able to get enough funds kind of raised that we’re still around.”
The company pretty much applied for every governmental loan or program out there, Hyden said. Now it’s just a waiting game to see when the company will be approved for funds, he said.
However, Hyden does think that Free Play will be able to open whenever the government allows it.
As of recently, some businesses are allowed to open under Gov. Greg Abbott’s reopening order. These businesses include restaurants, hair salons and malls, among others.
While the city has had to make difficult economic changes, Yelverton said it does have the capability to continue providing city services. The city and its community will have a lot to reflect upon after COVID-19, he said.
“Everybody’s going to have this common experience that they’re going to be able to share for a long time,” he said. “As opposed to people’s experiences that are typically a little more unique and sometimes maybe can’t relate because of it, well now we’re all going to be able to relate with each other because we all just lived through the same thing.”