$5M gap sparks spending freeze; Mayor announces, "Everything is on the table".

• Position: LOCAL NEWS

Byline: Matthew Bruun

FITCHBURG - The city is facing a $5 million deficit for fiscal 2009 and "everything is on the table" to close the gap in the coming months, Mayor Lisa A. Wong said yesterday.

The mayor announced a hiring and spending freeze, effective immediately, and said even the appointment of a new police chief may be postponed until the city gets a better grasp on its budget condition.

Ms. Wong, who noted she will mark her two-month anniversary in office tomorrow, described the scope of the budget problem at her weekly news conference.

"Transparency is very important to me," she said yesterday.

She said she has spent the first two months of her administration examining the city's financial situation, meeting several times each week with the city auditor, assessor and treasurer, and working with the state Department of Revenue to get a handle on the finances.

"After meeting with the DOR late last week to review a preliminary budget, we have identified there will be a budget deficit for fiscal year 2009 of approximately $5 million," she said. Asked whether that would mean layoffs of city employees, the mayor reiterated that "everything is on the table."

The deficit, she said, involves a budget that would provide level services compared to this fiscal year. It also assumes what she described as realistic revenue projections. She attributed the deficit to rising health insurance and energy costs and other factors.

"We do not want to be over-projecting revenues," Ms. Wong said. "We have gone over the budget line by line."

She said the hiring freeze may temporarily extend to the police chief's post, which has been filled since last summer on an interim basis by Capt. Philip J. Kearns Jr. The mayor is in the midst of background checks on the two finalists for the job.

She called the chief's job a basic function of the city, but said she could wait until later to decide whether to make an appointment.

The mayor's draft of the fiscal 2009 budget is due to be presented to the City Council by May 15.

Ms. Wong, an economist by training, made her fiscal background a cornerstone of her campaign. She won a landslide victory in November, months after the city endured a tumultuous budget review that included millions of dollars in cuts that translated into dozens of positions being eliminated.

"This is a situation that has taken many years for us to get into," she said. "The changes we are making will take time because they are deep."

City Council...