With a budget-balancing debt plan stalled, Moore, Okla., officials this week began furloughing all of the city's 215 employees for one day a week.
City Manager Jay Newton said all city workers, including himself, this week begin a 32-hour schedule expected to save $25,000 a week. The schedule is part of a plan to close a $1.1 million deficit in the budget for fiscal 1993, which began July 1.
"At the end of three weeks, I said that I would reevaluate the furlough," he said.
Representatives of the city's firefighter union, however, have threatened to seek in injunction to stop the furlough, which includes police and firefighters.
The need for the furloughs would be curtailed once the city issues a controversial $29 million taxable refunding of Moore Public Works Authority revenue debt. The deal is critical to balancing the city's budget, but some officials complain it would radically increase the utility's outstanding debt.
Under the plan, the city would extend the life of its debt another 15 years and increase the level of debt at maturity from $63 million to $104 million.
For now, the city is waiting to secure credit enhancement for the issue. Wall streets sources expect AMBAC Indemnity Corp. to decline to insure the refunding deal because of increased exposure. AMBAC insures the city-created authority's existing debt.
AMBAC officials declined to comment, and Mr. Newton said he had not been notified that AMBAC would not insure its deal. The backing is not vital to the deal, he added.