Austin @ Large: Austin at Large

Protection Racket: Austin needs an honest discussion on public safety spending

Austin @ Large: Austin at Large
Illustration By Doug Potter

As City Hall began its long march toward the fiscal 2003 budget last week -- all bad news, all the time -- one graphic popped out of City Manager Toby Futrell's presentation: A line chart showing that this year, 93% of Austin's sales and property tax collections will be spent on public safety. Next year, it will be 97%. Perhaps we should just employ Austin police to collect taxes and eliminate the middleman.

That public safety is expensive is in little dispute. This year, police, fire, and EMS service (mostly police) will cost Austinites more than $240 million -- more than half of the entire General Fund, which also pays for parks, libraries, planning, municipal court, and a host of other services. Since the utilities, convention center, airport, and other "enterprise funds" pay their own way, the General Fund is where all our sales and most of our property tax dollars go. (General obligation debt service -- paying off the bonds that built the police and fire stations, libraries, etc. occupied by General Fund departments -- consumes the rest of your property taxes.)

Do the math and you'll realize that, if public safety's 53.8% share of the General Fund equals 93% of tax collections, then lots of other important city services are being paid for with "miscellaneous" General Fund revenue. Mostly, that's the annual transfer from Austin Energy -- our "dividend" as owners of the utility -- which this year equals more than $91 million (about 21% of all General Fund revenue) and helps keep Austin's property tax rate far lower than other Texas cities. The rest comes from licenses, franchise fees charged to people like Southwestern Bell and Time Warner Cable, and miscellaneous nickels and dimes in parking meters, library fines, and such -- not the sort of revenue you want to depend on for core services.

With the property tax basically flat (appraisals have gone up, which thanks to state law forces the "effective" tax rate down) and sales tax famously plummeting, the public-safety share of Austin's tax collections would have gone up even if spending itself had not increased. But of course, it has, and not just because of post-Sept. 11 security needs, though that made a big dent in Austin's purse. The city had already committed, and says it remains committed, to bringing up police staffing to the magic 2-cops-per-1,000-citizens ratio, and Austin's current meet-and-confer contract with the Austin Police Association made our cops the highest-paid in urban Texas; meet-and-confer salary increases are the largest component ($16.2 million) of the new public safety spending anticipated in the FY 2003 budget. And none of those projections include the cost of the firefighters' own meet-and-confer, which is being negotiated as we speak.

So, when this fun fact popped up in Futrell's budget presentation, it raised an obvious question: Why is Toby telling us this? Is the point that we already spend enough on public safety, thank you very much? Or is it that we don't collect enough in taxes and have to depend unreasonably on Austin Energy to pay our freight? Both are good questions that will surely be asked, but probably not answered, this budget season at City Hall.

As for the first question: "Enough" is such a tricky word. Both Futrell and members of the City Council think the 97% figure shows that Austin spends a lot on public safety, and the stat's insertion into the budget forecast presentation (where it wasn't essential to understand what was going on) sends a message, or at least food for thought. In Council Member Daryl Slusher's words, "Let's have an honest debate and not say the city of Austin doesn't spend on public safety."

That's an air-mail-special-gram to, most famously, Texas Monthly publisher and frequent City Hall critic Mike Levy, who for years has used his voluminous e-mail list to lambaste the council for spending money on frivolities like the Austin Music Network while the number of "sworn staff" (cops in uniform) per capita declined, crime and traffic fatalities increased, and so on. Leaving the much-bashed Music Network aside, the budget forecast makes clear that there's no great reservoir of money lurking within the General Fund to pay for a couple hundred new cops and all their equipment. Any new public safety spending would have to come from less dependable revenue sources that already are being used to provide other basic services.

Which brings up the second question: When pressed, the more honest advocates (like Levy) of increased public-safety (or other basic-service) spending will tell you that raising taxes isn't such a bad thing. Austin is maxed out on how much sales tax it can charge, though the Legislature can always change that, and special sales-tax-funded "crime control" districts supplement police funding in Fort Worth and other Texas towns. But after the last 18 months, nobody will be looking very longingly at making city services more dependent on sales tax than they are now. As for hiking property taxes, we've banged that drum enough times in this space, but it's pretty clear the city's going to have to raise those -- modestly, but more than they've gone up in years -- just to cover the projected $70 million budget shortfall.

Others (like several council members) feel that taking the money out of Austin Energy isn't such a bad thing either, and you'll likely see the amount of the AE-General Fund transfer increase this year as well. But that, like a property tax hike, runs counter to years of City Hall practice; not too long ago, former City Manager Jesus Garza talked routinely of "weaning" the General Fund from the AE transfer, especially if retail electric competition were to come to town. So that's not a long-term strategy either.

What does that leave? An honest debate, but not a pretty one. Either Austinites swallow hard and agree to major-league tax and fee increases, or it learns to live without services like parks and libraries, or it puts the brakes on public-safety spending. This year, City Hall has made clear its intention of doing a little of each, spreading the pain equally without killing anybody. And probably without pleasing anybody, either.

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City Hall, fiscal 2003 budget, Toby Futrell, public safety, General Fund, enterprise funds, property tax, debt service, Austin Energy, Southwestern Bell, Time Warner Cable, Austin Police Association, meet-and-confer, Daryl Slusher, Texas Monthly, Mike Levy, Austin Music

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