Seattle will consider major cuts to its budget and capital-project plans because of an expected $43 million shortfall, Dwight Dively, the city's budget director, announced Monday.

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Seattle will consider major cuts to its budget and capital-project plans because of an expected $43 million shortfall, Dwight Dively, the city’s budget director, announced Monday.

In addition, Dively said he expects the city to be about $41 million short in 2010. The city’s general fund is $912.5 million this year.

Seattle is the latest victim of the national recession. King County is dealing with a $50 million shortfall for 2010, and state legislators are working out a way to fill a $9 billion hole between now and 2011.

“This is a recession unlike any we’ve ever seen,” Dively said.

The city brought in $13 million less than expected in the last two months of 2008 and forecasts it will have $29.5 million less than it budgeted for 2009.

The city has already made some moves toward saving money this year. About three weeks ago, Mayor Greg Nickels announced, for example, furloughs for some employees and pay freezes for top executives. Those will save only about $800,000.

Nickels also asked departments to come up with cuts of 1.5 to 3 percent. Those won’t be enough, Dively said, but the city doesn’t plan to ask departments for additional cuts this year.

“We will almost certainly be accessing those reserve accounts,” he said. The city has a rainy-day fund of about $30 million.

The operating budget is suffering from a loss of sales-tax and business-tax revenues, both of which are down because of the recession. Compounding the problem, the city has brought in about a third of what it projected in real-estate excise taxes, which are used for big maintenance and building projects.

Next week, the City Council will begin looking for big cuts to the city’s planned projects.

Seattle City Council President Richard Conlin said the council should look for other ways to fund projects, because canceling them affects the regional economy.

“We don’t want to take people off work when we need them back to work, if we have a reasonable alternative,” he said.

Nickels said he will prioritize public safety and human services as he recommends cuts.

As the council prepared to consider the budget shortfall at a meeting Monday morning, community members lined up to make appeals for important programs. Library users pleaded for consideration, and Jay Hubbard, who lives in Tent City 4 in Woodinville, asked the council to keep funding bus tickets he and other residents of the homeless encampment need to get into town.

“They’re looking for work,” he said in an interview. “A lot of people, they have medical problems. People I’ve met, they’ve lost their jobs and they’re stuck.”

Emily Heffter: 206-464-8246 or