Preliminary budget numbers for fiscal 2012 outlined for the Scottsdale's budget review commission last week indicate the city may be facing a $28.4 million revenue shortfall.

City manager David Richert said revenue in fiscal 2012 is estimated at $240.8 million, with expected expenses of $269.2 million. Scottsdale's fiscal year begins July 1.

Richert and other city officials told the commissioners that work must begin soon on a plan to deal with the projected shortfall, which could include reducing the number of city employees, cutting salaries, and turning over some city services to contractors.

Earlier this year, the City Council adopted a $234.7 million budget for fiscal 2011 that resolved a projected $18 million shortfall through spending cuts, a $6 million reduction in transit spending due to the loss of shared revenue from Arizona, and the use of $4.2 million from the city's surplus fund. It did not require layoffs or reductions in authorized positions.

Scottsdale's debt is rated triple-A by all three major rating agencies

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