Dollars Down to Earth
1995-96 City Budget Shoots for Balance
Hasn't this been a fun year for big dreams? What with plans floated to spend $30 million on a Palmer Auditorium retrofit, up to $100 million for a new city hall, recurring dreams to dump $60 million (apiece) into downtown mall subsidies, millions more for GAATN plans, a tax abatement ordinance designed to cut corporations millions in tax breaks, and $10 million (plus another $3 million for infrastructure) for a baseball stadium.
Nice fantasies, but then comes budget time, when the politicians and city staff finally have to come (almost) back to the world in which the rest of us live and at least make a perfunctory attempt at acknowledging our need to get from point A to point B, safely.
It's going to be harder and harder for city management to keep up with Austin's heady development. Forecasts for the next few years vary, but the city's growth is expected to continue at a 3.5-5.5% rate. If figures from the Texas Employment Commission and the Chamber of Commerce are correct, Austin will maintain a 5-6% annual job-growth rate, and will continue to have the lowest unemployment in the state - a mere 3%. Job seekers responding to the boom are expected to increase Austin's population by over 17,000 new faces annually - the city will grow to 612,830 by the year 2000. And all those faces will want the basics, like police and fire protection, EMS service, and smooth streets.
Tagging alongside the past year's headlines of the grand new world Austin would be afforded if it had a new city hall, a downtown mall, and a baseball stadium, was news that police, fire, and EMS are sadly underfunded; that the advancement in technology and book funding for the public library is about what you'd expect from, say, a small village in Belize; that the streets are not fit for automobile consumption; and that we simply cannot afford to run our hospital anymore.
The truth is, our city government runs on crisis management, no matter how well we're doing economically. We don't need a $600,000 consultant to tell us that Austin's growth and economic progress over the last five years hasn't necessarily translated into better city services. In fact, for some areas - especially the inner city and some outlying neighborhoods within the city limits - city services fall way short, or are simply non-existent. City Manager Jesus Garza noted this shortcoming in his presentation to the city council in August, pointing out the "inadequate or lack of new facilities in growth areas," as an "Unfunded Budget Issue." Several departments, particularly in public safety and public works, are already stretched to their absolute limit, and complain that they cannot serve the outlying areas efficiently without more vehicles, staff, and stations. Most of those needs will go unmet for another year, at least.
Garza asked each department to cut their budget by 6%, (except for public safety departments), proposed a 1cents effective property tax increase (the increase has since been changed to half a cent), and recommended raising the transportation fee charged on utility ratepayers' bill from $1.70/month to $2.19/month for residents, and from $8.50 to $10.97/month per acre for commercial payers. The increase will provide $2.5 million for street maintenance, says Garza. His attempt to serve two masters - sprawling growth and irate taxpayers - left the council with the dirty work of finding cuts to avoid the tax increase, or accepting blame for adding to taxpayers' burden.
City staff have proposed a $1.217 billion budget, $285.4 million of which will go towards the city's general fund (see chart). As reported last week, the city is proposing to sell $168.2 million in "revenue bonds" at the end of this month, which will go primarily to the electric utility for maintenance of existing facilities. Another $30.25 million in general obligation (GO) bonds will be sold for general fund projects. Our debt service for GO bonds will be $72.1 million, $5.2 million higher than last year. The consolation is that several long-awaited and worthwhile projects will be funded, including $15.7 million in land purchases for the Barton Creek Wilderness Park; $10.9 million for street repair, flood control, and parks maintenance; and $2.53 million for the construction and design of three new libraries - Dove Springs, Zaragoza, and North Loop.
Over the last six weeks, we've covered budget issues on some individual departments that closely affect the lives of Austin's citizens, like Parks & Recreation, Health & Human Services, Library, Aviation, the Electric Utility, and the Capital Budget. Last week, Daryl Slusher dealt with the city manager's delayering initiative. This week, we'll close out our budget coverage with a description of the proposed property tax increase and details on the big winner in this year's budget: public safety.
Property TaxesAustin's property tax revenues for 1995-96, assuming the newly proposed half a cent tax increase, amount to $126.3 million. $72 million of that goes to the general fund for department expenses, and makes up about a quarter of the total general fund budget; the remaining $54 million goes toward GO and other general fund debt service. Austin's property tax roll hit $23.2 billion this year, up $2.2 billion from last year, reflecting a bustling housing construction market. For the last year, we've been paying property taxes set at the "effective rate" of .5625 cents per $100 valuation. (An effective tax rate means the city takes into account higher property valuations and sets the tax rate to bring in the same amount of revenue from existing housing stock as the year before; additional revenue comes only from new construction.) The effective rate this coming year is .5394, but the proposed tax increase is set at .5443 to bring in an additional $1.13 million. Based on the average value of $98,271 for a house in Austin these days, the tax increase means homeowners will pay $33.45 apiece more this year, bringing their bill to about $534.80.
Word is, the tax increase won't happen now that the baseball stadium is going to a public vote and, if approved, will be paid for with bond monies. Originally, the council approved a $10 million expenditure for the city's part of the $22 million Phoenix Firebirds' facility - $8.4 million in "certificates of obligation" which don't require a public vote, but are paid for with property taxes, and an additional $1.6 million in sales tax revenue. There's been talk that the tax increase was planned in order to cover the $1.6 million when city staff found out sales tax revenues are projected to fall off by $2.7 million. City Budget Manager Brock Curry acknowledges that "everybody is talking about it," but denies the connection. In any case, it looks like the council will scale back to the effective tax rate, especially given the wealth of spending cut suggestions coming from Councilmember Brigid Shea, and those expected from Councilmember Jackie Goodman's office. Shea, in particular, is attempting to stave off any tax increase (see: "Council Watch").
Budget WinnersWhile other departments languished with cut or static budgets, public safety actually won budget increases for equipment, personnel, and vehicle replacement and repairs. Garza proposed a $10 million increase in general fund expenditures, and $6.8 million of it went to police, fire, and EMS.
* Police: Police Chief Elizabeth Watson's attempts to restructure the police department as part of her commitment to "community policing," and putting more officers on the street, were met with scorn from the leaders of the Austin Police Association union, whose 977 members make up 95% of the police force. A confidence vote on the chief was circulated by APA leaders a few weeks ago - 89% of those ballots came back with a "no confidence" result. The union's main beef? The proposed elimination of five captain and five deputy chief positions through attrition would cause a vacuum of leadership among the ranks, and an erosion of public confidence. Representatives from Hispanic, African-American, and female police associations also charged that the elimination of those upper levels reduced their chances for promotion. The APA's complaints led to negotiations with city staff and to a mutual agreement to eliminate the upper staff as suggested, but maintain or increase mid-level officers - the number of lieutenant positions will stay at 38, and Senior Sergeant positions will increase by three to 107 total officers. This proposal places three more officers on the street. Along with 25 new officers funded by the federal COPS grant last year, Austin has 28 additional officers on the front lines, and plans for 22 more in 1996-97 through a pending COPS grant application.
APD will receive $75.6 million this coming year, about $3 million more than in fiscal year 1995. Another $1.3 million was saved by eliminating one-time costs for vehicles and equipment. The savings will go toward expenses such as: 30 new employees in the 911 system ($1 million); pay increases as part of a state-mandated program ($1 million); increased jail operation costs in the main booking facility run by the county ($767,000); matching funds for the 25 grant-funded officers ($200,000); and full-year funding for the 47 officers added last year ($844,000).
* Fire: The immediate need for facilities in the Harris Ridge subdivision, Bergstrom, and US183/RM620 areas will likely go unmet for a while. But with about $3.2 million in additional funding for a total of $51 million, and with some creative staffing by AFD Chief Robin Paulsgrove, the department has been able to place 21 additional firefighters on the front line, and improve the lagging vehicle maintenance schedule. Those are the department's main priorities, along with a 3.5-minute average response time, and a four-firefighter-per-truck staffing goal. Response time is currently at 3.85 minutes, and staffing has languished at three per truck, while call volume rises by the thousands every year. This year, AFD will get five replacement fire engines and one replacement brush fire truck, plus one refurbished fire engine. The total cost will be $1.9 million and will come out of the city's Vehicle Acquisition Fund, not AFD's budget. $805,000 will be approved in bond funds to begin design for a new fire station proposed on Ralph Ablanedo Drive in South Austin. Another $300,000 in bond monies will buy equipment for the new fire stations added last year.
* Emergency Medical Services: EMS will receive an extra $1 million this coming year for a total of $12.3 million in their budget. Another $912,194 was saved by eliminating one-time costs. The additional funds will go mainly toward personnel for the new Advanced Life Support unit ($756,000) to be located in West Austin, four new Commanders ($343,153), clerical staff ($90,436), training, and equipment replacement. In addition, the Capital Budget includes $1.7 million for a new EMS station at US290 and Berkman, and expansion of existing stations on South First and E. Riverside Drive. Still, EMS has many unmet needs, including funds for staff and operations at the new and expanded stations, and money to pay for five units that need to be replaced. Maybe next year.
Budget Losers:* Social Workers: Four full-time and one part-time social worker positions and three community representative positions in the Health and Human Services Department (HHSD) will be eliminated this coming year, for a savings of $205,570. Social workers act as a city service liaison for patients in the city's clinic system. Of the 12 social workers within HHSD, eight are Spanish-speaking. All five targeted for elimination are Spanish-speaking, which led Councilmember Gus Garcia to question the decision by clinic director Sue Milam. Milam contends that federal Medicaid reimbursement reductions forced her to cut the positions; Garcia says he will attempt to re-fund the positions when the council votes on the budget September 11.
* Victory Tutoring Program: Run in seven of the city's 18 public libraries, the one-on-one federally funded program for low-income and disadvantaged children requires $204,000 in matching funds from the city now that the VISTA grant has ended its three-year run. The program, which will have served 625 students this year, will be cut, but library director Brenda Branch told the council that AISD officials expressed interest in applying some of the program's tenets to their own tutoring system. The program was hailed as extremely successful - in 1994, studies showed that kids involved in Victory had a lower drop-out rate, higher test scores, and fewer absent and tardy reports.
* Community Education Program: The city shares this after-school, drop-out prevention program with AISD, but this year, the city plans to slice $112,000 off its usual contribution, and will only pay $245,000. AISD plans to continue funding its half of $357,000, but some classes offered in the program will have to be sacrificed, say Community Education administrators. The classes offered vary from karate lessons to curriculum tutoring, and service both children and adults. School officials in low-income areas are particularly nervous about the cuts since they usually undercharge for the classes and make up the difference with help from other schools. Classes that are not self-sufficient have a greater chance of being cut from the overall program.
* Pioneer Farm: Over the protests of many supporters, this privately owned program that recreates life in Texas in the 1880s will lose its $200,000 in city subsidies this coming year. Pioneer Farm, located northeast of Austin on Sprinkle Cut-Off Road, is unlikely to continue without those funds.
Stay TunedThe city council will vote on the budget in three readings on September 11, 12, and 13. Councilmember Gus Garcia says he will reintroduce the Victory Tutoring program as well as the social worker positions for refunding. Normally, the city staff leave a few hundred thousand dollars in a "contingency" fund for councilmembers to vote on refunding cut programs, or for programs that require funding later in the year. The amount available this year is undetermined due to the projected decline in sales tax revenues, but expectations are high that at least one of those cut items will be back in the budget by the end of the process. n