Conway officials are budgeting conservatively and not starting any major capital projects to ensure the town makes it through these tough times.
"We reduced our building permit fee projects by about 70 percent from the previous year, which was about $600,000, and that was substantial for our budget," city administrator Bill Graham said.
Officials also are not beginning any new programs or making any major capital purchases until the economy shows signs of strengthening.
"When we see things start to turn around, we can react to that. We need to be conservative in our projections and hope for a sooner turnaround," Graham said. "We believe we will have less revenue and therefore we will have less flexibility in purchasing capital expenditures and nonessential programs or activities."
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Another signal of the downturn came through business license revenues, which are the city's second-highest source of revenue, contributing about $4 million annually to Conway's budget, Graham said. Business license fees are collected in June and July. Graham said that if local businesses are not doing well, the city's coffers could also suffer.
"They are based on gross receipts of the businesses, and with the downturn in the economy we do anticipate that there will be some reduction in business license fees in the city," Graham said.
City financial analysts do not project any revenue growth until at least the 2010-11 budget year, he said.