At this morning's state of the city address Mayor Pegeen Hanrahan didn't waste time mentioning the impact of the declining economy.

"The current fiscal crisis will likely mean a decrease in expected revenues for fiscal year '09, fiscal year '10 and beyond," said Mayor Hanrahan.

The city is already familiar with budget cuts. Dealing with them last year.

"In 2008 general government budget cut nearly two million from our operating account," said Mayor Hanrahan. "Enacting hiring freezes in all areas with the exception of police and fire, and putting administrative offices on a four day, ten hour per day work week."

The mayor also recognized that these are tough times for Gainesville's residents.

"Families are feeling the pain of depreciating home values and the specter of stagnant wages, if not layoffs," she said. "We must do all we can at a local level to improve affordable housing opportunities for our city residents."

The mayor says at this time the specific areas to receive budget cuts are unknown. She says they may be similar to last year's cuts.

"Some of it comes as a real negative to our city government, but for the most part i think we've been able to look at making changes that were not extraordinarily damaging," said Mayor Hanrahan.

Early revenue estimates will be presented before the city commission in February.

"We're bracing for how do we really meet this next challenge to ensure that we continue to have a great city, but do within our means," said Gainesville City Manager Russ Blackburn.