"I heard the city manager hoping out loud," said Mayor Will Wynn at the onset of last week's budget presentation, "that four of us would go to a hotel in Round Rock and break a quorum." But even if City Hall worked that way (it doesn't), it would have been too late. The bad news about Austin's fiscal crisis was already out; City Manager Toby Futrell and her department heads had spent the morning (personally) laying people off. There is no stopping the fiscal year 2004 city budget, which -- even after cutting nearly $40 million in General Fund spending, laying off employees for the first time in nearly a decade, and raising the property-tax rate for the first time in six years -- still only temporarily brings Austin's books into balance.
In the transmittal letter that accompanied Thursday's document dump -- traditionally the city manager's best platform for making his or her case to the council and the public -- Futrell says we are closer to the beginning than to the end of the campaign for fiscal liberation. The $38.2 million in cuts recommended this year are part of a belt-tightening effort that began right after 9/11 and will continue for at least two more fiscal years, and this year's hike to the effective tax rate will have to be repeated next year. "We could not achieve structural balance by 2006 without additional cuts and implementing the effective tax rate in 2005," Futrell writes. And that presumes "a slight economic improvement" by the end of Wynn's term. Actually, it presumes more than that -- the forecasts are based on modest sales tax growth for the next three years, something that hasn't actually happened now for 21 months straight (see "The Budget's Downhill Slide").
There is a chance, though perhaps remote, that Futrell's budget proposal is dead on arrival. Wynn, most vocally, has floated an interest in avoiding any tax hike -- which means cutting at least $15 million more from the budget. It remains to be seen who would actually handle that unpleasant task. Futrell undoubtedly has a list of additional cuts in reserve -- cuts she's anticipating having to make next year -- but Wynn has also repeatedly called for maximum community input to guide the further "forced tradeoffs" and "gut-wrenching choices" he suggests still need to be made.
Yet so far, the FY 04 budget process looks just like those of fatter years past -- three public hearings this month (at the council meetings of Aug. 7, 14, and 28), followed by three readings of the budget on Sept. 8, 9, and 10. This setup has traditionally given the council little opportunity to do more than nibble around the edges of the budget, and it's probably safe to expect that citizens will do this year what they've done before -- scream bloody murder about cuts to tiny pet programs like Pioneer Farm and ignore the big picture. (See " Budget 'Highlights' -- the Bad News".) If Wynn really wants to get community buy-in for "forced tradeoffs" right now, as opposed to over the next year for the next budget, he better get crackin'.
Or McCracken, as in Brewster. The newest council member wasted no time putting some daylight between himself and Fearless Leader, putting out a press release during Futrell's presentation calling for the city to make "long-term investments in areas such as transportation, workforce development, and economic development" and saying, "The city must protect funding for human needs. ... In these challenging times, we cannot afford to balance the budget on the backs of those in our community who need our help the most." On the first score, McCracken could be satisfied with Futrell's proposal -- funding for those "long-term investments" is still there, though certainly not growing -- but on the human needs side, it's already looking grim and, if Wynn has his way, could get grimmer. Futrell is proposing a 10% across-the-board cut in city social-service contracts and a $4.4 million cut to the Health and Human Services budget, cuts that advocates have suggested may effectively shut down nonprofit programs that depend on city funding.
The other members of what boosters perceive as Wynn's pro-biz majority have likewise deviated from the program. Council Member Betty Dunkerley, the former city finance director, is completely sold on a tax increase to the effective rate -- so much so that Futrell asked Dunkerley to handle the pro forma explanation of what "effective rate" means. (This was in response to McCracken's point that the effective rate leaves the community's overall tax burden unchanged, another one of the planks of his "budget strategy" and a way of saying the council isn't really about to raise taxes.) "It is the rate that I personally think is absolutely necessary to maintain the financial stability of this city," Dunkerley replied.
While Council Member Danny Thomas has not been so explicit about taxes, he was clearly more peeved than anyone about one of Futrell's prime cuts -- delaying for two years new parks and libraries approved in the 1998 bond bonanza, including the rec center in Colony Park (named at Thursday's meeting in honor of Eastside activists Dorothy Turner and the late Velma Roberts) that he pointed out had been promised to the neighborhood in 1977. "It's a sad case," he said, noting that City Hall's "errors in ... spending decisions" allowed the boom to pass by the Eastside. "Why did we continue to promise things to these communities, send staff out to have meetings and make plans, [if] now that we're down to the nitty-gritty, we can't perform?" he asked from the dais. He didn't exactly get an answer.
It will take longer than five weeks, or a year, or even three years, to do what the city really wants and needs to do; the FY 04 budget is the first official engagement of a campaign not just to tighten the city's belt but to transform its operations from the ground up, a campaign that will likely last as long as the U.S. occupation of Iraq and that will define Will Wynn's mayoralty, no matter how long it lasts and whether he wants it to or not. Futrell is publicly coping with the worst job in town by focusing on the light at the end of the tunnel. "History has shown that opportunity's favorite disguise is trouble," she says in the transmittal letter. (It's a great quote. She's used it more than once.) "I believe we have a unique opportunity to balance this budget by rethinking and reshaping government. ... I have to believe that we can come out of this recession an even stronger organization. And that will be our silver lining."
Yeah, yeah, yeah, you say -- Futrell's famous sincerity aside, "process improvements" and "reinventing government" are apple-pie buzzwords used to obscure all manner of cuts, sins, and tragedies. Futrell's predecessor Jesus Garza was also fond of reorganizing this and streamlining that and thinking outside the box, and see how lucky we are to have the results. Already, the "service delivery model changes" Futrell has included in the FY 04 budget have raised howls from the constituencies whose processes are being improved.
These include the firefighters' union, which objects to the proposed "squad/quint model" that would replace existing fire companies with smaller ones in the densely packed urban core (specifically in Hyde Park and Clarksville), and combine two engine companies into one larger one at several stations on the perimeter. And neighborhood buzz is already not so good about the dramatic downsizing and reinvention of the city's much-abused development review shop; in Futrell's proposal, a single, smaller team would handle each development project for its entire journey through the city pipeline, from preconstruction site-plan review to final building inspection.
Such changes, as dramatic as people think they are, will not be enough to balance the books. Futrell can cut and slash and reorganize until Judgment Day, but only in ways that -- however liberally defined -- leave the city's basic palette of services unchanged. This is a standard refrain in the budget document, for department after department: "The proposed budget includes reductions" of whatever amount, "strategically selected to maintain the department's ability to provide core services." That is Futrell's mandate as city manager. She says the reductions in her FY 04 proposal "are already through fat, through muscle and cutting into bone," and she raises doubts that the organization can really withstand too much more belt-tightening -- at least not this year -- and still be able to provide these core services.
Anyone who lived through the 1990s in Austin -- when citizens and council alike enthusiastically spent every boom-spawned dime that came in and has now gone away -- knows how big a change this is. The strategies for picking up the slack are few. Consolidating local government revenues and functions is an option; it's the strategy underlying the push for a hospital district, and there are probably other ways the city, county, and school district can better allocate their combined wealth (see " Austin Taxes").
Futrell and Danny Thomas both threw on the table the prospect of the private sector abandoning its usual maxim -- "That's why we pay taxes" -- and coughing up money to provide what we now call core services. One of the facilities that had been set for a two-year delay -- the South Austin Soccer Complex -- will instead open on schedule because the soccer leagues have agreed to pick up the operating costs. Thomas is eager to find similar support for Colony Park. Five years from now, private and corporate sponsorship of what are now public-sector operations -- like parks and libraries -- may be standard practice.
In any event, Wynn's most important job right now -- even more important than using his magical mayoral powers to revive the economy -- is to bring the city and its citizens into the same room with this unpleasant reality: The city of Austin spends too much money, and it spends most of it providing city services in a very costly way, in response to demands from every segment of the community. The fact that the local economy will probably get worse before it gets better (witness the state's own budget cuts and layoffs) makes the fiscal war to come even more arduous than Futrell's budget suggests. If some services are really more important than others, or if some can be better provided by someone other than the city, it will be up to General Wynn and his trusty lieutenants to overcome resistance and win the hearts and minds of the people.
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