Manager says Phoenix shortfall hits $245 million

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PHOENIX -- Phoenix's budget deficit continues to escalate.

In an e-mail to city employees Tuesday, Phoenix City ManagerDavid Cavazos said the budget shortfall for the current fiscal year and next fiscal year is a combined $245 million.

That's 22 percent of the general fund that pays for police and fire protection, libraries and other basic city services.

The figure approaches the record $270 million that was cut last year from the budget, including a $156 million hit to city services.

Cavazos blamed the national recession and lagging tax revenues for the deficit run up. He added that layoffs are almost certain.

All city departments have submitted proposed budget reductions of up to 30 percent. Public safety departments submitted proposed cuts of 15 percent.

(Copyright 2009 by The Associated Press. All Rights Reserved.)