The budget-cutting has begun. Mayor Chris Beutler announced Thursday the city’s projected $6 million budget shortfall has been reduced to about $1.5 million.

But those cuts won’t be painless.

Beutler will propose to the City Council next month a reduction in the city payroll by about 45 employees. Some, but not all, of those cuts will come from the ranks of 33 employees who’ve applied for early retirement incentives.

For example, Antelope Valley project manager Wayne Teten plans to take advantage of the incentive program and retire, and his position will not be filled. But when Library Director Carol Connor retires in September, her position will be filled.

If 45 positions are cut, the city work force will have shrunk by more than 100 in the past two years. The city would have 50 fewer civilian employees than in 1990.

Until last year’s record-setting 63 job cuts, the most city positions previously cut in one year was 28 in the early 1990s.

Even the police and fire departments would likely face cuts, the mayor said, since public safety accounts for more than half of city spending.

“When you consider that fact in light of the budget deficit we face, it’s nearly impossible to leave police and fire off the table,” Beutler said.

If the City Council sticks to its guns and refuses to increase property taxes, Beutler said it’s likely library hours would be cut, swimming pools closed, aging services reduced and economic development efforts reigned in.

Beutler put some pressure on the City Council to decide whether it’s willing to make the cuts necessary to leave the city property tax rate unchanged.

“If the City Council decides that this budget must be balanced without any revenue increases, the cuts will be deep and in some cases, very severe,” he said.

Skeptics often accuse city officials of threatening such draconian cuts annually, only to find a way to balance the budget without them.

Beutler says he’s not crying wolf.

“Some will accuse the administration of using scare tactics,” he said. “This is not rhetoric. This is reality.”

“The unfortunate fact is that past city government decisions to put off the tough choices on the budget has dug our fiscal hole very deep,” Beutler said.

He is also proposing to: 

* Possibly reduce new city employees’ retirement benefits to a 1.4-to-1 match, rather than the current 2-to-1 match for civilian employees. Beutler said the 2-to-1 match is “out of touch” with the private sector.

* Cut the StarTran bus system by $589,000, possibly by reducing midday service.

* Restructure public works, parks, library, building and safety, aging and health departments to save money.

Other changes are coming to the bus system: Beutler wants to increase bus ridership by expanding the popular “Ride for Five”  program to more moderate-income residents.

Now, low-income residents can get $5 monthly bus passes. The mayor is also considering consolidating the plethora of bus fares into one “very low fare.”

Since the budget projections were made, fuel costs have had to be adjusted upward by $750,000. But the city also got good news when it learned its health insurance costs would be nearly $1 million less than expected — the result of switching to a self-insured plan in 2006.

City Council Chairwoman Robin Eschliman complimented the mayor, saying he appears to be taking seriously the public input he got through a survey and town hall meetings. StarTran was a lower priority for people, and a property tax increase wasn’t popular at all.

“I’m pretty impressed with this guy,” she said of Beutler reducing the shortfall to $1.5 million. “He works very hard.”

Eschliman said the council gets pressure to increase property taxes from special interest groups, but not from average Joes.

If Beutler’s cuts are too deep, she said the council will have to find other cuts. Although she’s been a frequent critic of unions, she complimented them for working with the administration during a tight budget. Five of the city’s six unions are renegotiating contracts.

“From what I can tell, they are really compromising,” she said. “They really are working with him.”

Beutler said the administration is “very, very close” to an agreement with three of the unions but has “a ways to go” with the other two.

Beutler is dribbling out pieces of his budget proposal, but won’t  unveil his entire budget proposal to the City Council until July 7.

The council will spend much of July and August working on the budget before approving a final spending blueprint in August.

Reach Deena Winter at 473-2642 or dwinter@journalstar.com.