XENIA, Ohio -- The city of Xenia is tightening its belt because of sinking revenues and questions about funding from the state.

City employees may now be faced with expanded cutbacks in an effort to balance the city budget.

Some non-union workers have already been hit with the wage freeze and that could be expanding to nearly every employee.

Xenia is facing a deficit between $1.1 and $1.3 million officials said the cuts could hurt basic services like police and fire protection.

City leaders eliminated 15 positions back in 2003 and said more could be coming.

Xenia City Manager Jim Percival said, ""We've been working with the employees. We've been able to meet with all of our employees both the union and non-union employees and have laid out some strategies including position cuts, request for our folks to take a pay cut and probably some limited layoffs."

Percival said the city is considering its options and trying to make any cuts where it will impact city services the least.

One big question is what kind of funding Xenia will be receiving from the state next year? That question won't be answered until state leaders reach a final compromise on the new budget which is already overdue.