The City of Auburn this week began its second round of layoffs in 2009.

“The layoffs are in process today,” Human Resources Director Brenda Heineman confirmed Tuesday. Heineman declined all further comment, including the number of employees who would lose their jobs, noting that Mayor Pete Lewis was expected to issue an official statement Wednesday after this edition of the Auburn Reporter went to press.

But the Auburn Reporter has confirmed that at least three positions were to be cut from the Auburn Parks, Arts and Recreation Department and one from the city’s Communications Department.

In the first round of layoffs last March, the City laid off 24 employees.

All of the City’s bargaining units were in the last year of their contracts, and employees were notified in early December that there would be no raises in 2011 or 2012.

Lewis told the Auburn Reporter earlier this month that there would be more layoffs, adding at the time that he had to wait until the police and the machinists, the last of the city’s seven bargaining units, took their final votes and either gave concessions or didn’t.

“We have no money because costs are still going up 2 or 3 percent per year, and we don’t have an income to match that,” Lewis said. … “I’m at the end. I have nothing left. We either get the concessions, or we have to cut.”

Auburn is not only reeling because of the recession, it is dealing with zero growth in the business sectors that have changed their sales tax reporting to point of sale.

Since 2008, the City of Auburn has seen a 20-percent, or $4 million reduction, in sales tax revenues. It has also witnessed a 50-percent decrease in development fees. Accordingly, Auburn’s 2010 budget focused on maintaining essentials like the level of service for police and public safety operations like streets and lights. Sales tax gains of more than 1 or 2 percent a year are not expected for the next four or five years.

The City has responded by reprioritizing projects, reducing spending and evaluating all programs and service. It also has eliminated redundancies and in some cases, cut programs completely. It also froze 33 positions as they became vacant.

The streamlined sales tax or SST, which the state implemented three years ago to tax sales over the Internet, factors into the city’s financial woes. Before SST, when a company made a product and somebody bought it in Auburn, the city received the sales tax. Under SST, however, the city in which the person sat down when he or she purchased the item over the Internet gets the sales tax.

Recognizing the financial hardship that SST would impose on cities with large manufacturing bases, the state of Washington set up a mitigation fund, which takes into account all the companies across the United States that are expected to voluntarily send sales tax money to the point of sale. Auburn lost about $2.6 million to SST, and it is receiving about $2 million in mitigation funds.

The mitigation is expected to decrease as out-of-state sales taxes are received to supplant mitigation receipts. Gov. Christine Gregoire has proposed eliminating the mitigation fund entirely from the state’s budget.