Memphis mayor Willie Herenton says cuts are coming to the city's budget.
The announcement came during a Memphis City Council retreat Saturday afternoon.
Herenton says dipping into the city's reserves is a last resort, which is why he's looking to trim money elsewhere.
"I wanted to apprise the Council and let them know we've got to reduce some our personnel, reduce some of our benefits, look at revenue trends so it won't be a shock to them when we come forward with our budget," he said.
"And also, we've clearly made a statement that next year there will be no tax increases."
Without a tax increase to go along with the cost of living, the mayor says 2009 will be a tough year.