LUBBOCK, Texas — The City of Lubbock is bracing for hits to their budget following the coronavirus. Chief Financial Officer for the city of Lubbock, Blu Kostelich, said they began feeling the effects last week.

“This is really unprecedented, with the business shutdowns, the stay at home orders, so we had to take a pretty aggressive look at this,” Kostelich said.

With non-essential businesses closed for several weeks, and others making adjustments and losing revenue, the city is feeling the pinch, especially when it comes to sales taxes.

“Less spending equals less tax dollars that come in through sales tax,” Kostelich said.

Sales taxes make up a significant amount of the city’s general funds. To prepare for the loss, the city has come up with a COVID-19 Budgetary Response that went into effect in March.

“We have made cuts in our budget,” Kostelich said. “Really what we’ve done is kind of a three phase approach to this.”

The first phase is a hiring freeze, so if there are vacant seats within the city, those won’t be filled unless the positions fall within public safety and public health.

The second is an immediate freeze on general fund discretionary budget spending.

“Expenses such as training and travel. A lot of supplies,” Kostelich said.

Phase three entails an immediate freeze in selected cash fund capital, meaning the city will hold off on projects relating to parks and golf courses.

“We’re looking at about $7.1 million in expense reductions and what we have right now in our estimates are about 5.6-5.7 million dollars in revenue loss,” Kostelich said.

However, the city is still doing better than they had anticipated. Looking at the budget from a more conservative standpoint, Kostelich was expecting a 10 percent loss in revenue compared to last year, but only saw a 5 percent loss.

“The spending was a lot higher than we were projecting,” Kostelich said.

The budgetary response will remain in effect until the end of the fiscal year. Kostelich does anticipate the city to recover. Kostelich said the city is within their budget by about $300 thousand. The city is preparing for a three to four million dollar swing into the negative.

Kostelich also adds as they begin to look at next years’ fiscal budget, they will consider a ‘flat budget.’

“We do anticipate some recovery,” Kostelich said. “When this happens or how that looks, we really don’t know at this point. So, we have to be very conservative in our estimates. What we’re doing in the budget process is really taking what we consider a flat budget, so anything that was budgeted this year really carries over, and we’ll have about the same level of expenses next year.”

For more information on the city’s response the coronavirus pandemic, visit their website.