The Budget Is Hell

Ernest Hemingway once wrote that nothing is as bad as war. He never covered a council budget session. Two days... 12 grueling hours... $1.3 billion spent... Casualties: One councilmember and one downtown consultant.

To the victors, the spoils. The two big winners last Wednesday were Beverly Griffith and Gus Garcia, who ran away with $1.4 million for their so-called "Social Fabric Initiative" to expand Parks and Recreation Department programs. Ronney Reynolds made off with $1.3 million for the police. To make Austin a Euro-urban mecca of neighborhood shops and parks, Jackie Goodman eked out $900,000. To shape up the Electric Utility Department, Bruce Todd got $2.7 million. Eric Mitchell got sick on the dais.

Or so announced his white shadow, Ronney Reynolds, explaining Mitchell's two-hour disappearance from the middle of the free-for-all. Sadly, it set off a round of guffaws among the press corps, which in turn prompted a public scolding from Reynolds. But in defense of the media's over-exuberance, no one actually saw Mitchell turn the color of money, and he had displayed his usual punch and vigor. But the no-cash blues had set in with regards to Mitchell's budget initiatives, and he was no doubt suffering. Throughout the meeting, even though his initiatives were D.O.A., Mitchell bravely persevered in his attempt to cut the Energy Conservation Rebate program by $9 million -- never mind he personally took advantage of the program in the past. His efforts produced zilch. No wonder he felt sick. In return, he announced a "blanket comment" of non-compliance, refusing to vote for anyone's pet projects. The mayor even took the pleasure of casting his vote: "Just mark Eric down as no."

The rest of the council collaborated like conquistadors at Tenochtitlan, because a prize of adequate size sponsors goodwill in even the worst enemies. At least temporarily. The prize, that which remained in the general fund after accounting for the necessities, was $5.6 million. Into that, the council dove with glee, Mitchell's curmudgeonly parsimony be damned. They ignored Mitchell's dismay at the sudden turn of events: "We had [the budget] identified at the work session last week [five days previous]. I don't like the idea of us finding and spending $5 million at the last minute."

The extra money came via last-minute tinkering by financial services director Betty Dunkerley. She rerouted $1.5 million in interest from the hospital fund to pay for Social Fabric Initiatives; uncovered $1.8 million in excess revenues from last year; and found about $1.5 million from funds obligated to other projects but never used, including a $500,000 windfall sitting unspent in the city's liability fund. Slusher and Griffith scraped together another $680,000 in police revenues by calling for an increase in the fees that clients of burglar alarm systems have to pay when they cause the police to respond to false alarms.

So, despite Mitchell's grousing, the councilmembers tore into the newly-found $5.6 million like kids at a candy store. After all, they had their wish-lists in hand and the items listed -- amounting to a $7 million-plus summation of pet projects -- wouldn't come cheap. First on the list was the Electric Utility Department's transfer to the general fund. The transfer is the general fund's umbilical cord, indeed, the fate of the city depends on it. It comprises 20% of the general fund, and if you examine any basic city service, like police or EMS, you'll find the transfer attached to the other end.

But the well is runnin' dry. The state legislature is expected to deregulate the electric utility market eventually, and that means the EUD will face stiff competition. To get ship-shape, staff recommends weaning the general fund off the transfer, allowing the EUD to funnel more profits into self-improvement. This year, staff recommended holding the transfer at $60 million, allowing a $4 million savings from last year to this year.

Considering its significance -- the transfer has kept the city's property tax rate relatively low -- reducing it will no doubt be the top council nail-biter over the next few years. It's an issue that demands leadership, and true to his rank, the mayor led the reduction charge. Indeed, his only wish for this year's budget was that the council make an acceptable cut, and his proposal went far beyond the call of duty. He wanted to reduce the transfer to $57 million, in essence, a $7 million cut. The rest of the council didn't share his urgency. Griffith and Mitchell wanted no reduction, and would keep the transfer at the full $64 million. Todd's proposal quickly died, getting only three votes -- from Garcia, Goodman, and himself.

Reynolds offered a substitute motion: Reduce the transfer by only $5.6 million: "I'm just trying to find four votes."

Todd? "No."

The two women and Slusher? Abstention.

Only Mitchell, who had earlier called for no reduction, found sympathy for his compatriot. Garcia refused to vote since the lack of supporting votes had already nailed the coffin. "What difference does it make?" he asked.

Sensing that the council was softened up to the idea of some kind of reduction in the transfer, Todd kicked off his rally anew. "To do anything less [than $7 million] is far from being honest with the voters. We have lower tax rates than other cities because we've relied on the cash cow called the EUD. That's no longer possible."

Todd called for another vote on his $7 million reduction. Reynolds reneged and consented. In a bold move, Garcia voted: "Yes." Also nodding assent were Goodman, and of course, Todd.
Slusher abstained. Mitchell and Griffith kept their nays, but the item passed.

Garcia called the transfer the "monster," and with it out of the way, the pressure eased. Even a hint of giddiness prevailed, especially with Reynolds, for glory was just around the corner. He quickly motioned to provide $1.25 million for police. But in the haste for public brownie points, he had cut in front of Griffith and Garcia on the wish list. The council noticed, and immediately returned to the so-called "Social Fabric Initiative." It aims to decrease juvenile crime by funding various youth programs at the city's oft-closed recreation centers. Armed with statistics and evidence -- such as a study of Los Angeles gang members who, in the wake of the city's riots, pointed to parks and rec centers as a way to put them on the straight path -- Griffith was a forceful speaker. "This is powerful juvenile crime prevention," she said with her usual peppy emphasis and Junior League smile. "That is where the crisis is, and this program is crisis prevention."

Mitchell agreed with the concept, but he didn't think the idea sufficiently developed. Despite his dissent, however, it passed easily. Reynolds abstained. Maybe he was angered that his police proposal was temporarily tabled. But approval was only a matter of time. How could the council not support the police? Rest assured, they did -- none of Reynolds' campaign-like speeches were necessary. Only the sick-from-sour-grapes Mitchell dissented. Of the $1.25 million in added funding, $650,000 will help pay for new police equipment. The remainder will fund overtime. It will also allow all of the city's 10 neighborhood centers to stay open, and the DARE and Citizens Police Academy programs will survive another year, despite staff recommendations. Low on patrol officers, city staff wanted to nix the programs, to take those officers from their community beat to patrol cars.

Thereafter, Reynolds moved to provide $75,000 to Pioneer Farms. Staff had recommended cutting the farm, a microcosmic retreat of life in the old days located outside Northeast Austin.

Mitchell protested this funding with more than just a curt "no." He pointed out that "Pools can't be taken care of in the inner-city, but we can fund Pioneer Farms?" He questioned the tourist haven's historical value, adding, "If you're talking about preserving the past, am I supposed to go out back and pick cotton?"

Reynolds responded that inner-city kids are the site's most frequent visitors. In the "pioneer spirit," Slusher offered a friendly amendment to charge out-of-Austin residents 25 cents extra admission. It saw a quick death, but the funding passed. Mitchell dissented. Garcia abstained.

Slusher also lost out on saving $650,000 by putting off the city's electronic parking meter program for a year. He did, however -- much to the discomfort of the mayor -- successfully cut the city's downtown consultant. Staff wanted to set aside $100,000 for Keyser-Marston, a San Diego consulting firm, for help on spurring downtown re-development. Downtown is already experiencing a renaissance, Slusher argued, adding, "We can move forward without flying folks in from California to help us out."

When the motion to delete the consultants' funding passed with four quick votes, the Keyser-Marston fanatics on the council were off the dais. Mitchell was absent, and Reynolds and Todd were in the antechamber, perhaps enjoying the fruits of their labors regarding the EUD and police on the evening news.

Eventually, Todd returned to his throne, and asked anxiously: "What happened to Keyser-Marston?"

"We cut it," Garcia replied.

Todd squeezed his eyes tight... leaned his head back very slowly... and groaned. Would he too become another budget casualty on the dais?

He appeared to calm himself: "Ohhhh.K."

He opened his eyes, and with a self-exonerating tone, concluded, "Majority will."

And he shouldered the agenda forward, now to a proposal for a $1 million reduction to the Energy Conservation program. For this, Mitchell had recovered quite miraculously, and he returned to the dais with fresh robustness. He wanted the program cut by an astounding
$9 million. Reynolds tried to talk sense to him, noting that the council wouldn't even go for the $1 million reduction. Mitchell stayed the lonely course. Reynolds proposed an $800,000 reduction. Only Todd approved. It failed. For now, funding for the program will remain at the city manager's recommended level, $13.2 million -- which already represents a $1.8 million cut from current levels.

The council also:

* Passed $800,000 worth of Goodman's recommendations for overhauling the city's bureaucratic development process. This is supposed to allow more options for developing and improving the urban landscape. Mitchell voted against the recommendations. Reynolds abstained.

* Raised the garbage fee from $11.64 to $12 a month. And beginning in February, 1997, each trash bag that doesn't fit into your city-provided receptacle won't be taken unless it has a $2 city sticker on it. The measures passed unanimously.

* Approved higher drainage fees. For residents, the monthly bill goes from $3.30 to $3.67 a month. For commercial customers, it rises from $35.66 to $39.59.

Like any epic adventure, the real drama came at the finale. Accounting for all the approved luxuries, expenses exceeded savings by $1.9 million. The council had already decided that they would generate $1.8 million in new tax revenue to offset the city's debt burden by setting the tax rate at 52.51 cents for every $100 of property value. That's down from last year, but homeowners will pay an average of $10 more in taxes because the council didn't decrease the rate enough to offset the rise in property appraisals. No one wanted to raise taxes any further. So where would the moolah come from?

A light bulb could faintly be seen hovering over Beverly Griffith's head. The council took a 10 minute break, before Todd marshalled them together again for "a very important motion" from Griffith -- various budget maneuverings that totaled $1.9 million. Most of that came from transferring $600,000 from federal monies that the city receives for taking care of indigents to the general fund for clinic support. Another $200,000 will come from savings in the city's vehicle maintenance division. And the city manager will have to find another $200,000 in savings over the course of next year.

"We're borrowing from Peter to pay Paul," complained Reynolds. Still, he voted for the overall $1.3 billion budget.

No one was surprised when Mitchell voted against it with his usual charm: "I didn't get anything I wanted, but that don't matter."

It seemed like everything was over, but while the rest of the council relaxed, Reynolds made one last move to give more to the police. He called for the transfer of $150,000 to Austin police from the Parks department's horticultural unit. But the beauty of the city's parks was saved when the council didn't bite. Only Reynolds, Todd, and Mitchell voted yes.

So Reynolds compromised, cutting his proposal in half -- $75,000 for the horticulturalists and the same for police. This time, Goodman relented.

Reynolds' last-minute maneuver seemed to insult Slusher, who noted that the council had already approved $1.25 million for the police, and that another $75,000 wouldn't sponsor that many officers. "The budget was over, and the campaign had begun," Slusher later said, referring to Reynolds' bid for mayor in 1997.

That's true, of course. It should be pointed out that the Austin Police Association is much more politically powerful than the Gardeners' Association. On the other hand, campaign rhetoric can have positive results, and more police on the streets isn't such a bum deal. Either way, with the need for drastic cuts to the EUD transfer only increasing, and with living expenses continuing to rise, the decisions will get tougher. And the choices will be a lot more complicated than whether to protect lives or flowers.

n

It would be a gross overstatement to say that nothing happened at last Thursday's regular council meeting. But the joke was that after 12 hours of budget deliberations on Monday and Tuesday, the councilmembers were sick of being together and wanted to cut out before dinner. They did.

Before chow time, they did manage to approve Leisure Management International as management for the Central City Entertainment Center. LMI, a Houston company, will receive a flat rate of $100,000 a year. To be located in Central East Austin, the center, complete with bowling lanes, movie theatres, and a skating rink, is expected to open in October, 1997.

This week in council: no meeting.