This is part of the 2009 USGS budget request for 2009, written sometime last year. Scroll down to "Highlights of Budget Changes" and you find this (boldface mine). Numbers are in thousands of dollars, so "$5,394" is actually $5,394,000:

Geologic Hazard Assessments:

The budget proposes a net decrease of $5,394, including decreases of $1,969 in the Earthquake Hazards program to eliminate a 2008 unrequested increase in funding for multi-hazard work, $3,000 in Earthquake Hazards for earthquake grants, $492 in Volcano Hazards to eliminate a 2008 unrequested increase in funding for volcano studies, $492 in Global Seismographic Network to eliminate a 2008 unrequested increase in funding, and a reduction in travel of $328. Fixed costs total $1,122, of which $887 are budgeted and $235 are absorbed.

In other words, they thought "Volcano Hazards" was using up too much money. Do you honestly think the USGS is scrimping on instruments around live volcanoes?

The mayor has no idea what he's talking about. You are being fed bullshit.