At a meeting of the city council's finance committee this morning, city finance director Dwight Dively revised his forecast for the city's revenue shortfall to $72 million (which city hall sources predicted would be "awful" earlier this month) for the 2009-2010 biennium. The new forecast is down $16 million from the previous budget forecast.

The revenue forecast will be the basis of Mayor Greg Nickels' next (and possibly last) budget. City hall sources say that if Nickels doesn't make it through the primary (which now looks likely; new numbers at 4:30 this afternoon), any proposals for new spending (e.g. on cops) will probably go ignored by the city council. A Nickels loss could also embolden the council to push its own proposals—such as a "dedicated fund" for bike and pedestrian projects, which council member Tim Burgess has requested.

That $72 million doesn't translate directly to $72 million in cuts. The city has $30 million in its "rainy day" fund, intended specifically for situations like the current budget crisis. Some $25 million of that could go toward paying down the deficit. If city unions decide to accept a proposed ten-day furlough, that could save another $8 million or so. (Most non-union employees will be put on furlough automatically, except employees who are necessary to public safety—police dispatchers, for example—and those who make more money than they cost, like parking meter readers.)

Maintaining cuts that were made in the middle of 2009 could save another $10 million. Finally, if the unions agree to a minimal cost-of-living adjustment (union contracts set the minimum annual COLA at 2 percent), that would save another $5 or $6 million, getting the total the city needs to cut down to about $25 million.

Nickels will submit his budget on September 25. In a statement today, he said he would spend down the rainy day fund and vowed not to cut human services or public safety.