PROVO — The city is experiencing the pinch of a slowing economy, said Mayor Lewis Billings on Tuesday, and it shows in next year's budget.

But the mayor said he doesn't recommend raising taxes to cope with the downturn.

Billings presented a tentative city budget of about $147 million for the 2009 fiscal year Tuesday at the Covey Center for the Arts. During the presentation, Billings said the city is not free from the impact of the current economic downturn.

"We continue to be a growing community," he said. "And we're experiencing all the benefits that come with growth, but also all the challenges."

Based on in-depth analysis, Billings said, his staff expects to see a downturn in city revenue generated from sales tax, property tax and community development fees during the upcoming year.

At the same time, he said, the city is seeing a substantial increase of 19 percent in fuel costs and a 25 percent increase in health benefits for city employees. Billings showed the audience a graphic to depict the cost of fuel and health benefits over a 10-year period.

"This graphic, when I first saw it, almost took my breath away," he said. "That's a very expensive, sobering reality."

In response, Billings said he isn't proposing any tax increases, but he does recommend increases in Justice Court plea and abeyance fees, parking tickets, ambulance base fees, engineering and inspection fees, parks and recreation fees for adult and youth sports, as well as increased pool fees at Veterans Memorial Park.

Billings' proposed budget also provides $23.5 million for capital improvement. Some projects he mentioned included golf course renovations, a gateway for Center Street, an airport radar and Slate Canyon Trailhead access.

Billings said improving the community is important for economic stimulation.

"When cities quit investing in themselves, when they quit fixing and maintaining ... the cost of doing so later goes up dramatically," he said.

The City Council will take the mayor's recommendations into consideration when they finalize the budget in June.

City Council member George Stewart called the mayor's budget presentation "straightforward."

"Provo, like the rest of Utah and our country, are facing difficult financial times and the mayor's proposed budget addresses that reality," he said.

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