Dallas officials are examining potential staffing reductions and additional cost-saving measures as the City works through mounting budget concerns ahead of the next fiscal year.
City Council members discussed the issue on Wednesday during early budget planning talks, focusing heavily on personnel expenses, which make up the majority of the City’s spending. Payroll-related costs — including employee salaries, overtime pay, pensions, and health insurance — account for about 72% of Dallas’ overall budget.
City Manager Kimberly Bizor Tolbert said the City has already reduced expenses by removing vacant positions over the last two years, generating approximately $21 million in savings since 2024. Departments are now being evaluated to determine whether operations can continue efficiently with fewer workers or reorganized staffing structures.
Officials are considering whether certain functions could be consolidated so fewer employees can handle workloads without affecting services provided to residents.
“But I can’t tell you that there will not be cuts. I can’t say that,” Tolbert said, per Audacy.
Financial officials warned that Dallas continues to face budget pressure from multiple directions. Current estimates place the shortfall between $18 million and $34 million, fueled largely by escalating overtime costs in police and fire departments, rising employee healthcare expenses, and slower-than-anticipated sales tax revenue.
Chief Financial Officer Jack Ireland told council members the City workforce has expanded by more than 900 positions over the past eight years, with most of those additions tied to public safety departments.
Council member Chad West said City leadership is addressing the financial concerns earlier than in previous years, giving officials more time to respond before the budget is finalized.
“We’re going to have to make some hard choices,” West said, per NBC 5 DFW. “We’ve got to prepare for the worst.”
West, who leads the council’s finance committee, said City administrators are being more proactive this budget cycle instead of waiting until late summer to outline possible reductions.
“They’re not waiting until August to come tell us ‘hey we’re going to be cutting these departments, we’re going to be cutting this overtime’ – they’ve come to us very early – earlier than they have in the past,” West said.
To curb spending, Dallas has already frozen hiring for most civilian positions outside the police and fire departments, as previously reported by The Dallas Express. City leaders have also restricted travel, limited overtime, and reduced non-essential purchases.
Tolbert said maintaining public safety services remains a priority despite the financial strain.
Council member Cara Mendelsohn argued that the City’s workforce growth is a major contributor to the budget imbalance.
“Every problem with our budget could be fixed if we just get our staffing back on level,” Mendelsohn said.
She noted the City employs roughly 2,000 more workers than it did seven years ago.
In addition to workforce discussions, council members proposed other ways to improve the City’s finances, including potential fees on undeveloped land and a closer review of City-owned properties that could be sold.
West said balancing the budget will require cooperation between City management and elected officials.
“It’s important we step up, we take responsibility for making sure the budget is balanced as well – we just can’t put it on her (Tolbert),” West said, per NBC 5.
Budget discussions are expected to continue throughout the summer before the City releases its proposed spending plan in August. Officials are also watching for a possible boost in sales tax collections tied to the upcoming FIFA World Cup.
The City of Dallas fiscal year begins on October 1.
