City Budget Public Relations Battle Begins
Posted by Jeff Pruitt - 8/2/09 @ 9:31 am - Filed Under Featured, Local Politics
City controller Pat Roller has been sent out on the offensive to lobby for city employees in the upcoming budget process:
But Mayor Tom Henry’s administration believes it can keep all its employees and give them raises next year. [...] “The goal is to not have any layoffs in 2010,” Roller said. [...] Achieving such goals while facing declining revenues won’t be easy, Roller said. She said the administration is trying to keep costs down this year in hopes some surplus money can help cushion for next year.
Let’s talk some reality here. The budget deficit, with the 1.5% salary increase, will be upwards of $9 million for next year (at least). As I’ve said before due to declining property values and other revenue the deficit for 2011 could be even larger.
Last year I looked at potential long term budget fixes and they didn’t look too bad; simply keeping a flat budget for 2010 and reducing future growth in expenditures would do the trick. The catch of course was the assumption that revenue would continue to rise at 3.2% per year - obviously not going to happen in the near-term.
And that’s what everyone needs to watch out for - what exactly are the city’s revenue projections? That’s where the manipulation could be done. If they overestimate the growth in revenue then the short term budget crunch won’t look so bad and they’ll be able to minimize cuts. Of course this simply kicks the can down the road but it would buy them time.
City council should request an independent revenue forecast from someone outside the administration so they can start with the most accurate numbers possible. Granted forecasts can (and will) be wrong but you have to start from somewhere. I think the days of 3.2% annual revenue growth could be gone for quite some time and thus I see no way possible the city can avoid major cuts.
And major cuts usually mean personnel reduction - either through attrition or layoffs. Except the city always has another trick don’t they? They can increase taxes either through the local option income tax or by moving items from your property tax bill to being fee based - like fire hydrants. Either way it’s a tax increase…
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2 Responses to “City Budget Public Relations Battle Begins”
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Best method to avoid raising taxes?Keep salaries flat.No new raises.It seems incredible we would be discussing this during the worst economy since the Great Depression.Perhaps if local government had to mirror the local unemployment rate then they might think twice about raises or new spending projects.
Jeff,
This post is excellent and it is dead on. The City of Fort Wayne has massive looming budget issues and it is 100% impossible for anyone to beleive that there is room for salary increases of any kind based on the lower revenues the City is going to receive.
Employees throughout the private sector are seeing paycuts,reduced hours, and downsizing.
The City of Fort Wayne needs to freeze salaries and prepare to lay off employees.
Mike Sylvester