Logansport City Council members met for the first time this week to start the process of shaping next year’s city budget.

The initial budget submitted to the council by department heads this month called for $14.75 million. The document, obtained by the Pharos-Tribune Tuesday, includes $11 million for the general fund, highlighted by more than $2 million each for the police and fire departments.

Scott Kraud, the council’s president, said the budget was almost identical to last year’s $14.4 million document, with the only changes being due to increases in health insurance and fuel costs.

While last year’s initial proposal included a 3.5 percent wage increase for the 150 city employees, this year’s proposal contains no increase at all.

Still, the council has a long way to go before the budget can be finalized.

A change in the property tax structure approved by the state legislature will cost the city. Although the exact amount is not yet known, city officials are anticipating a budget cut of about $1 million, Kraud said. All of that money will come from the general fund.

Council members started the cutting process on Monday. First to go were a number of positions left vacant by retiring police officers and firemen. While the police and fire departments were hoping to fill the slots, they will instead be eliminated.

Those two cuts saved $234,442, according to numbers prepared by Clerk-Treasurer Ruth Ellen Brand. Another $5,017 was saved through cuts to the board of works. The cuts were a good start but left the council with about $750,000 still left to be cut, officials said.

In general, the cuts are “going to have to be from services,” Kraud said in an interview after the meeting. He pointed out that 65 percent of the budget goes to the salaries and benefits of city employees, adding that those appropriations are more flexible than equipment.

“That’s where it’s gonna be,” he said.

A proposal to increase employee contribution to their health insurance plans was also floated at Monday’s meeting. Last year, their portion was increased from $30 a month to $60 a month, and this year the increase could be even higher.

But some councilmen opposed the measure.

“I’m 100 percent against it,” council member Charlie Hastings said. “You’re not giving a pay raise!”

“It’s still a hell of a deal,” said Councilman Brannon Meagher.

Members also discussed dropping eye or dental care from the coverage and forcing smokers and overweight employees to pay more. After a contentious discussion, the issue was tabled.

It was scheduled to be discussed in depth by the health insurance committee during a meeting this morning.

Council members were also concerned with rising fuel costs. The initial budget proposal included doubling last year’s gas funding for the police and fire departments. Meanwhile, Street Commissioner Donald Crain has already spent most of his 2008 gas allocation and will also need an increase in next year’s budget.

Many of the proposals brought up at the meeting Monday were not approved or denied, but simply discussed.

All of the cuts must be made and the budget approved by the end of September. Last year, the council had to call an emergency meeting on Sept. 25 to pass the final document.

Monday’s meeting was the start of a long process, council members acknowledged.

“It’s going to be hard,” Kraud said after the meeting. “But there’s a medium there. We’ll find it.”

The finance committee, composed of all seven council members, will meet again at 4 p.m. Monday in the City Building.

Brian Rosenthal can be reached at (574) 732-5148, or via e-mail at Brian.Rosenthal@pharostribune.com