Amendments Reduce Tax Increase by 3%

Read the City Manager’s proposed (not amended) budget.

In November, I reported in detail on the City Manager’s 2010 budget proposal. My earlier comments, which provide a fair amount of background and context, are in my news archives HERE.

This week, after multiple special meetings and one public hearing, the City Council adopted a final budget for 2010. The adopted budget reduces the originally proposed tax increase from 8.9% down to 5.9%, translating into a cost of $169 for the average homeowner. This reduction was accomplished through two amendments:

The Council opted to issue bonds instead of paying cash to cover certiorari payments and certain capital costs. The resulting savings were applied evenly to the 2010 tax rate and to the City’s fund balance, which can be utilized to moderate taxes in 2011. To be honest, this is really a cost shift, rather than a cost cut, but one that is justified by low interest rates and by the reasonable expectation that our fiscal challenges will be most acute this year and next.

More controversially, the Council opted to eliminate contractual salary increases, with the intent of freezing salaries for all City employees. The draft budget already froze salaries for non-represented employees, including all commissioners and elected officials, and for unionized employees not currently under contract. The Council’s additional action — a cut of $800,000 in total — affects employees in the midst of a contract cycle, specifically those in our firefighter, public works, and civil service unions. It is the Council’s hope and intent that employees in these bargaining units will accept a salary freeze as a fair and equitable means of addressing our fiscal condition. If not, then regrettably layoffs will be necessary in the affected departments.

I voted in favor of both of these amendments and also in favor of the final budget, but I will not pretend that these actions were easy. The 2010 budget is filled with painful choices that reflect both the weak economy and the constraints on our local authority. There is little in the document that will prove popular. That said, I accept my responsibility to govern by making the best choices available and by using common sense and candor to weigh competing priorities. Despite its many objectionable elements, I believe that the 2010 budget strikes a fair balance at a time when good options are in short supply. As always, I welcome your feedback and suggestions.

One final comment: it is noteworthy that the Council’s vote on the budget as a whole and on specific amendments did not break down along party lines, but split instead in different configurations, depending on the issue. I think this is a healthy sign that demonstrates independent thinking on the part of Council members. To meet the difficult tests of the moment, we need to put aside partisan impulses and work together.