RADFORD -- The $47.4 million budget City Manager Tony Cox proposed Monday night is more than $2 million smaller than the one he proposed a year ago.

But to make that budget balance, Radford will have to cut 16 jobs, raise real estate taxes, increase electricity, water and sewer rates, raise ambulance fees and reduce the quality of some services.

The flower beds around town might not look so nice. The streets may not be as well maintained as they have been. Those baskets full of flowers people have become accustomed to seeing on downtown lamp posts will disappear. And no one who works for the city is getting a raise.

Some members of council talked about charging residents for using the recreation center and for fire department responses.

"It's not a surprise," Cox told council. "It's just the chickens coming home."

While economic chickens are coming home all over the world, Cox said Radford's challenges are unique. It's not the credit crisis or the housing bubble or complicated investment instruments causing Radford's problems. It's a long-term shift from manufacturing jobs.

With fewer of those jobs in the city, industrial consumption of water, sewer and electricity services is declining. That is decreasing the amount of money the city can expect to get from those utilities.

Unlike most localities, Radford sells and distributes electricity. The profits generated by that enterprise has allowed the city to keep its taxes relatively low. For example, Radford's real estate tax rate is higher than the rates in Giles and Pulaski counties. But it's lower than the rates in Christiansburg, Blacksburg, Pearisburg, Pulaski and Montgomery County.

If the money that electricity generates were to disappear and real estate taxes were raised to cover the gap, Radford's rate would be higher than all those communities as well as Roanoke County and Vinton.

"We're riding the electric system pretty hard," Cox said. "I guess the question we're going to be faced with is how much can the old girl handle?"

Part of the 14 cent real estate tax increase Cox proposes was expected. The city knew it would begin paying off the debt on a new elementary school in the coming year. Nine cents of the increase will pay for the debt. The remaining 5 cents will cover the loss of other revenue.

Real estate taxes provide 35 percent of the city's revenue.

"Our big lever we have to work with in terms of balancing our budget ... is real estate property taxes," Cox said.

Cox's proposed budget assumes that revenue from personal property taxes will decrease. The value of SUVs and pickups is falling, Cox said, and relatively few people are buying new vehicles.

The decrease in water, sewer and electricity use means less money from those sources. Cox expects the faltering economy to drive down sales tax receipts. Meals taxes should bring in as much as last year, he estimates, mostly because of Radford University students.

In addition to the real estate tax increase, Cox is proposing an average 12 percent increase in the electricity rate, and a 9 percent increase in water and sewer rates. The water rates would still be low compared with the localities Cox chose for comparison, but the increase would put the city's sewer rates above the state average.

Even so, the budget calls for six full-time, eight part-time and two seasonal positions to be cut.

Zack Kyle, the city's human resources director and zoning administrator until he left for Salisbury, N.C., at the end of January, won't be replaced. One firefighter, one police officer and one communications officer will be eliminated, as will the city horticulturist, three laborers, several interns and some part-time positions. Most of those jobs are vacant already.

There are lots of unknowns in Radford's budget equation -- what the economy does, what the state budget gives the city, the effect of the federal stimulus package, how much money the city's schools will need -- but there's not much time to deal with them. The city plans to have a public hearing on the budget March 23. If the schedule holds, council will approve the budget April 13.