City officials, faced with a $12 million budget deficit, are trying to avoid cutting back on basic services but may have to put off hiring more police officers and firefighters to do so.

City Manager Mike Hein told City Council members Tuesday afternoon that they would face some difficult decisions as they begin to review next fiscal year’s budget, according to a live Internet broadcast of the meeting. The city’s fiscal year begins July 1.

It includes balancing the fiscal needs of city services with the expansion of public safety, transportation, and parks and recreation programs called for as part of the city’s 10-year Fiscal Sustainability Plan.

Under the plan, the city would use increases in revenue, primarily from sales taxes, to hire 40 police officers and 29 firefighters a year while expanding street maintenance and the hours of parks programming. The plan was approved in 2006 and is completing its second year.

Hein said the plan may have to be put on hold for a year as the economy recuperates from the slump in the housing market.

“You can’t increase salaries for everybody and increase staffing levels,” Hein told the council. “You have some very difficult choices. We’re going to have a tough, lean year ahead of us, but over time we’ll be able to get to the goals that you’ve outlined as a policy- making body.”

“It’s going to be painful,” Councilwoman Nina Trasoff said. “We have to constantly be looking at that balance between what we would ideally like to do and maintaining the basic level of service.”

Councilwoman Shirley Scott said she was concerned that putting off police hires would hurt areas of town that already do not have enough officers.

Hein said the Police Department could use the lull in hiring new officers to fill vacancies.

Councilwoman Regina Romero asked city officials to begin looking at alternative funding sources.

“It scares me to think of maintaining the status quo,” Romero said. “I agree with making sure that the level of public safety and the level of service to the community should always be increased.

“What are we doing as a city to look at the revenue flows that are coming into the city?” she asked. “Are there other things that we should contemplate?”

City Budget and Finance Director Jim Cameron said the city is striving to find multiple revenue streams.

“Quite honestly, when the economy is doing well we tend to worry not too much about the revenues,” he said. “Diversification of revenue is very critical. Reliance on revenues that move the same way is not a good thing.”

The city relies on city sales and property taxes, state shared revenues, impact fees and fees for trash and water services.

Councilwoman Karin Uhlich wants officials to look into how the city can mitigate the affect that a lean budget will have on its residents.

“The cycles for our revenue are obviously tied to business cycles and economic cycles,” she said.

While the city is looking at tough financial times, its residents, business owners and employees also will be faced with financial hardship, she said. Examples are increases in bus fares and commercial trash fees that the council is expected to review soon.

She suggested that the city look at increasing bus fares annually as opposed to a single large increase every 10 years.

In other matters, the council also approved increases for more than 100 fees charged by Tucson Water.

They include fees for late payments, new service starts and developer fees for installing major infrastructure. The fees increases take effect July 1.

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